Been on the wrong tax code and not paid enough tax - what happens?

[Wineonafridaynight]

As the title says really. It appears I have been on the wrong tax code for 13 months. I need to sort it out tomorrow.

What are the tax office likely to say re: paying it back? Will it be over the next 12 months or will they make me pay it all back now? Or would they let me extend it to more than 12 months. Any advice?

By the way the reason I was on the wrong code is that my company car appears not to have been noted down at all, despite the fact I called up to tell them.

Any advice would be appreciated.

Thanks.

They will deal with any underpayment by altering your tax code so you will repay it over the remainder of the tax year - ie by April 2011.

Why are your employers not dealing with this? They are legally obliged to make a return of benefits received by their employees at the end of each tax year on form P11D, which they should give you a copy of. If they have not completed this correctly they are liable for penalties.

I had exactly the same issue - I contacted the tax office several times to tell them I had a company car, but my code was never changed and I forgot all about it - until they finally took notice!

As Cantcarryon said, they adjusted my code so the money was paid throughout the next year.

By the way, tax on company cars is always a year in arrears as they tax you on the benefit shown on your year end |P11D - ie you don't get taxed until the end of the tax year.

When the tax office receives the P11D form from your employer (they have to complete these by july after the end of the tax year) they asses the value of any benefits in kind (including company cars) and alter your tax code so that you pay the tax owed on the benefit in the previous tax year over the whole of the next tax year. If you only started receiving the benefit from April 2009 it is normal not to have your tax code altered to pay the tax until they receive the P11D in July of this year.