Tax Calculation

[Lofty-25]

Good bless the tax man, we had a letter arrive on Saturday (14/01/12) from the tax man stating that an 'underpayment' for an earlier year was included in your PAYE code, but the actual amount underpaid for that year was lower

The reason for the overpayment 'incapacity payment' was included in your tax code for 2009-2010

The next letter included with the above letter stated:

I have reviewed your income tax liability for the year shown above (2010-2011) to see whether you have 'underpaid or overpaid tax' for that year

My calculation is given on the enclosed sheet. The calculation result is given near the foot of that page

This calculation includes an overpayment for an earlier year. The reason for the over payment 'incapacity benefit' was included in your tax code

Either a tax demand for payment (under payment) or a cheque (for over payment) will be sent to you within 14 days of this letter for the outstanding over payment

I got back from the London Branch RWFCA meeting tonight and there was a cheque from the tax man for £3216.08

God bless you Mr tax man (who said there was a recession)

#Please excuse any miss-spelling/punctuation JT as it is 03:52, as i have had one or two over the eight (a good and a somber day)

[Gwyn Nicholas]

From my experience with the Tax office in recent years, I honestly believe they need a damn good audit from some outside agency. I went from receiving a letter claiming underpayment to no less than three Tax rebates (nothing like Loftys figures unfortunatly). It makes me think, that the accuracy depends on the time of day your tax is calculated ie in the morning or after the standard public servants lunch (rumoured to be in the region of 2 hours).

There are an estimated 29 million people working in the uk, take a single pound of tax of each of them per year (so it is not missed except by the very shrewdest) and you have a very nice little earner do you not. Of course you would have to overtax some to allow for an occasional rebate. We all get a Tax form that explains exactly how tax is calculated, allowances etc from which we are supposed to made aware of what is due and why. What I cannot fathom is, if that form is accurate and made simple enough for Joe Public to comprehend, why and how do the originators of it mess it up so often.

Dont spend your dosh too quickly Lofty, there may be another letter winging its way from the morning shift!

[Lofty-25]

Lol Gwyn, the cheque has been banked and that is where it will stay for now

[Keith Jones 989]

Lofty, excellent advice about not spending it for a while. However, I would put it into Premium Bonds and keep it there for a year. Should the taxman ask for it back (and that is OFTEN the case these days) you will still have it and you never know, you might pick up a prize or two along the way?