According to data published by the Society of Professional Accountants, as many as 1 in 5 PAYE tax code notices issued by HMRC since the start of the year could be wrong.
Thousands of incorrect tax codes were sent out in January and February following a recent upgrade of HMRC’s income tax and national insurance system. Although these issues were picked up fairly quickly by the Treasury, tax payers, accountants and umbrella companies are still dealing with the fall out nearly 3 months later.
The actual process of changing a tax code is fairly simple, and generally involves just one phone call to HMRC who can amend the tax code over the phone. However, many tax practitioners are now being advised to send written confirmation of a tax code amendment in the post, which has further delayed the process.
Umbrella companies are unable to act on behalf of their contractors (or employees) in this matter. If you suspect that your tax code is incorrect, the fastest course of action is to contact your local tax office for advice.
The tax code saga is likely to roll on for at least the next couple of months and HMRC expect another surge in enquiries at the end of April (i.e the first month of the 2010 / 2011 tax year).
© 2010 All rights reserved. Reproduction in whole or in part without permission is prohibited.
Image: Correct / Incorrect by Yan Basque
