PAYE tax refunds
HMRC has started its annual reconciliation of PAYE for the tax year 2013/14 and has begun sending out tax calculations to some taxpayers using the P800 form. The form shows HMRC’s tax calculations in respect of the tax year ending 5 April 2014. This form is sent to taxpayers after HMRC has received details of the salary, pension and tax paid for each individual from employers and pension providers. HMRC uses this information to calculate if the correct amount has been paid.
In the majority of cases, taxpayers that pay tax through the PAYE system will have paid the correct amount of tax. However, if too much or too little tax has been paid taxpayers will be sent a P800 form.
Taxpayers that have paid too much tax, will be sent a cheque, in most cases, within 14 working days from the receipt of a P800 Tax Calculation. Those that have paid too little tax will in most cases have the underpayment collected automatically through their 2015-16 annual tax code over 12 months. Where this is not possible, HMRC will contact taxpayers to discuss the available options to pay the tax outstanding. The recovery of tax underpaid can usually be spread over longer periods in cases of financial hardship.
Any taxpayer that receives a P800 form should check that the figures quoted are correct.