PAYE tax refunds
Earlier this year HMRC completed its annual reconciliation of PAYE for the tax year 2012/13 and sent out tax calculations to relevant taxpayers using the P800 form. The form shows HMRC’s tax calculations in respect of the tax year ending 5 April 2013. This form is sent to taxpayers after HMRC have received details of the salary, pension and tax paid for each individual from employers and pension providers. The information is used to confirm that the correct amount of tax 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 2014-15 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, or take professional advice, to ensure that the figures quoted are correct.