I hate the HMRC!!

[nephilim2k]

So I get home from a job interview yesterday to a letter from the HMRC. According to them, I've underpaid my tax to the tune of £1400 over 2 years. As I don't have a job, they can't adjust my tax code, they've given me the choice of the following. Pay off using 5 months worth of job seekers or have bailiffs come round. Cue a phone call to the HMRC who kindly informed me as I didn't agree to either terms, and asked for a recalc, said they'll take me to court or cut off the JSA.

Spoke to CAB, who said its all perfectly legal as technically it counts as a payment plan. I spoke to my various companies that I pay bills too, explaining the situation, they've been reasonably helpful. One freezing payments, but still accruing interest, one freezing payments until I have money coming in (and accumulating no interest) and my phone company have been less than helpful, saying pay out the contract, or sell my phone to pay out the contract, and the remainder making the choice of pay or default. I never got PPI with the cards, as I saw it as a con (I was 18 when I got them, been reasonably good with the cards, never going near the limit, always making payments, mostly in full, but some months (July/Sep/Oct) I couldn't as the car AND boiler packed up, so had to use the cards as emergency funds and pay back what we could.

Went to an accounting lawyer for a 1 hour free consult. Seems going to court is my only option, however I will also incur the HMRC fees on top, but in the mean time, I have to pay out.

So no christmas for me/wife/daughter I'm now stuck, as I have zero funds coming in, £90 going out. This will force me into an overdraft which will add £25 a day fees. Any advice is helpful, we've cut back where possible, and the mrs wage is used up on her bills/mortgage/car.

 

[BoomerD]

wut?

Unless you're only "talking" to the brits here, you might want to revise that and get rid of the acronyms so everyone else knows what the fuck you're talking about...

 

[nephilim2k]

HMRC = IRS equivalent
PPI = payment protection insurance. Was a big scam over here as it was horribly mis sold.
CAB = Citizens Advice Bureau. They offer free legal advice etc in these matters
JSA = Job Seekers Allowance. What you get when looking for a job (I was made redundant in October)

 

[mwtgg]

wut?

Unless you're only "talking" to the brits here, you might want to revise that and get rid of the acronyms so everyone else knows what the fuck you're talking about...

Don't be such an ass about it. It's quite clear what he's talking about.

With regard to your situation, do you agree with the assessment? Is it accurate or not? Aside from that, I don't have much advice for you as I don't know how the British tax system works.

 

[nephilim2k]

Honestly, no...the employer cocked up. We have a Pay As You Earn (PAYE). Employers are supposed to calculate tax based on how much they will pay you between 6th April-5th April. It should be automatic, however if someone either inputs the wrong tax code (even by a letter/digit out) it goes wrong.

Turns out they put me on the wrong code to begin with, which they should have realised. I didn't know as it was the same code as previous employment. HMRC are notorious bastards with collection of money. They'll take as fast as they can.

I've seen one person have 2 months wages fully deducted to recover tax, and said person was earning nearly £4000 a month. Just hope I get a job soon, as frankly, Christmas is cancelled in my house because of them and I'm not sure how I'm going to break it to my daughter (she's 4 and massively believes in Santa).

 

[mwtgg]

Honestly, no...the employer cocked up. We have a Pay As You Earn (PAYE). Employers are supposed to calculate tax based on how much they will pay you between 6th April-5th April. It should be automatic, however if someone either inputs the wrong tax code (even by a letter/digit out) it goes wrong.

Turns out they put me on the wrong code to begin with, which they should have realised. I didn't know as it was the same code as previous employment. HMRC are notorious bastards with collection of money. They'll take as fast as they can.

I've seen one person have 2 months wages fully deducted to recover tax, and said person was earning nearly £4000 a month. Just hope I get a job soon, as frankly, Christmas is cancelled in my house because of them and I'm not sure how I'm going to break it to my daughter (she's 4 and massively believes in Santa).

You obviously consulted with someone who's more versed in British tax law, but based on some limited research, it looks like there's certain circumstances where you wouldn't be liable for the underpayment. Unfortunately, it looks like once you got that notice then it doesn't apply. If you noticed the underwithholding and contacted your employer and they didn't fix it, then it looks like you might've gotten off the hook. Now, it looks too late, but like I said, I'm in no way an expert in British tax law.

See: http://www.hmrc.gov.uk/thelibrary/tax-paye/employer-errors-deduction-paye.pdf

 

[nephilim2k]

Yeah...I've spoken to 2 separate lawyers now on a 1hr free consult. Family are stepping in and providing food, I have a garden of vegetables which I can take marrows/squashes/peas etc from, it all helps. Just got to find £90 a month for the next 5 months to avoid my bank charging me £25 a day for being overdrawn.

 

[nephilim2k]

Just spoken to the bank (hurray for 24/7 phone numbers). They've agreed no interest or daily charges for the next 5 months beyond £50 per month. Progress! Only took an hour on the phone to them!

 

[mikeymikec]

Is this the first time that the HMRC have contacted you about this? It just seems odd that they seem to have gone into "final demand" mode without any notice at all.

I once went awry with tax a few years ago, not to the same amount as you did but HMRC were quite agreeable about me paying it back steadily. I have the impression that as long as you agree to some sort of payback plan you won't have a problem.

 

[nephilim2k]

Yeah its the first time. I got the letter, and the demand. According to both lawyers, over £1000, they start recovering immediately, regardless of circumstance. Its annoying as hell, but at least the bank were helpful.

 

[mikeymikec]

I would think you could royally spank them in the small claims court. The small claims court is for anything below £3k, and if one party basically isn't interested in compromising at all (either through arbitration which is the first step, or by avoiding arbitration), it tends to go badly for that party, as I understand it.

I haven't been through the small claims court myself, I once suggested that I would go that way to a lettings agent who was trying to play hardball for no good reason, and they backed down.

I suspect that if you pushed it towards the small claims court, HMRC would probably back down. It seems to me like you hold all the cards here, the only advantage they have is that they will have the beefier lawyers, but do they really want to run the risk of spending loads more money for such a (relatively speaking) trifling sum.

Admittedly, I don't know whether this is a case that the small claims court would handle, but it's worth inquiring IMO.

 

[Mark R]

PAYE is a real nuisance if it's done wrong.

Over the last 2 years, I've had 6 different employers. Every single one got the PAYE wrong, which caused absolute chaos. At one point, the employers were so slow in producing the P45 "employee leaving employment" certificate, that HMRC thought I was working 3 jobs, and I was having 90% of my salary deducted at source as tax. The worst bit about this was that I could not get a refund of overpaid tax until after the end of the year, once I'd submitted my final tax return.

When I did sent in that tax return, I ended up getting a formal tax investigation for unpaid tax because 2 of my employers didn't put my last months wages on the P45 (and I didn't check the figures, by going through all the pay stubs).

PAYE is great if it works, but it depends on your payroll departments knowing what they are doing. If they don't, you are screwed.

 

[nephilim2k]

I'm in the latter..the employers didn't do it right, so I'm just having a hard time of it all. My daughter was understandably upset that "Santa's elves are sick". I'm still worried because even though I wont get charged more than £50 a month, by the end of the ordeal (if I get no judgement in my favour) I'll be in my overdraft by around £750 plus whatever fees...so will be having to figure out how to get out of that. May need to start up a "help me" paypal fund, lol

 

[nephilim2k]

I have spoken to a total of 7 people at HMRC. None are willing to arrange anything with me and all said take the HMRC offer or go to court to fight for it. The HMRC are just utter gits. I have tried to be reasonable (£60 a month is what I can reasonably afford until i am employed). However they are saying all of the JSA will be taken until its paid. Hardly fair. Will see on wednesday if that is the case as thats when i am expecting my next payment.

 

[mikeymikec]

Local MP?

 

[nephilim2k]

To top off things, I got a letter from DWP (missed the postman today, so had to collect from post office), that I wont be recieving my payments until I have reached the signing date - April 4th, by which point it should be paid off (according to HMRC/DWP)

And I have an appointment with the MP.

If anyone feels generous in the mean time, I'm always grateful for donations. lol

 

[Blackjack200]

I love this thread. I feel like I'm watching a very serious and dark version of Mary Poppins.

Sorry for your troubles OP. Any chance you'll be able to find work soon?

 

[nephilim2k]

I have applied to approximately 930 jobs over 7 weeks, and had just 12 interviews. My trouble is my disability+PhD in IT screws me over, nobody wants to hire a disabled guy, and I am over qualified for most of the stuff I apply for. I have had interviews at 4 universities, so hopefully one of them says yes.

 

[tommo123]

not sure if an option but i dont think even they can demand the entirety of your JSA. if it went to court, have a payment plan showing your income and expenditures and make a reasonable offer of repayment (until you get a job to pay more). the judge shouldn't be able to go "i don't care if you need heating and food, you'll pay more".

p/s look at contracting. you dont get sickness/holidays etc but you're more likely to get a job i think

 

[EagleKeeper]

IF a PhD is not critical for the position being applied; do not advertise such.

Here in the US unless your disability precludes you from doing the job applied for; it can not be weighted against you. However, proving such can be difficult.

I do not know what the UK rules are.

What is the line of work - maybe you need to think outside the box?

 

[nephilim2k]

I applied to be a santa in a shopping centre, so outside the box isn't an issue. I've done contracting, and I could probably have the money within a week of doing so, but in my specific line of IT, contracting is few and far between, and I'm usually one of the first people to be called when my line comes up.

In the UK, the rules are that you shouldn't hold it against someone, but I lost out on a job where I knew one of the recruiters, and he was blunt and said someone with lower qualifications (has a masters), but similar level of experience was taken, purely based on the fact they thought I'd be a liability for their insurance!

The lawyers think I'll be successful with offering £60 a month until I am in a paid job. £60 isn't unreasonable, but a court date could be anywhere until February, so until then, I get no income unless I find a job, but its difficult!

As for not telling I have one, most places now demand you list all qualifications, and do background checks. I've missed it off before, then it came up in an interview, and I lost out because I was deemed dishonest for not declaring it. Damned if you do, damned if you dont. Whilst I have no regrets in doing the PhD, its certainly my biggest hinderance in getting a job (outside of university roles).

 

[Koing]

What area of IT do you do and what is your disability if you don't mind me asking?

Koing

 

[EagleKeeper]

I've done contracting, and I could probably have the money within a week of doing so, but in my specific line of IT, contracting is few and far between, and I'm usually one of the first people to be called when my line comes up.

The above does not make sense.

You indicate that you can get a contract job within a week,

Then the next phrase state that such jobs are rare.

If the PhD has no bearing on the qualifications needed for the job; there is no need to list it.

 

[nephilim2k]

No, what I meant was...I could earn the £1400 within a week of securing the contract, however my line of work is few and far between.

My specific line of IT is very rare - specifically Education Management Information Systems Human/Computer Visualisation ~(working on how efficiency can be improved on educational MIS systems through statistical analysis). I worked for Capita (UK's largest MIS firm, developing a program called SIMS (Schools Information Management System), my updates were deployed to nearly 90'000 schools.

My disability, is Menieres disease with Fibromyalgia and Rheumatoid Arthritis.

And as I've said, I have not listed it before and been caught out, so damned if I do, damned if I don't.

 

[nephilim2k]

Just checked my bank (as all bills come out today bar 2 which were yesterday)...seems like each company were lying, 6 direct debit failures because they tried to take with no money in my account, and the bank slapped on £15 for each failure, plus £25 for being in a negative :'(