Hi Joanne

Just some random thoughts.   The tax code, is that from the P60 or is that what it is currently?  If it's from the P60 then I'm surprised HMRC haven't issued a further tax code correction to recoup the shortfall, might be worth checking that.

I would explain to client that your software shows tax outstanding, which can be nullified with the S/E losses, but that HMRC are a law unto themselves and may issue a refund.

Personally I think it will correct itself once the return is submitted, assuming HMRC haven't corrected the code since.  Don't quote me on that though!!

 

I re-tried HMRC and got someone willing to provide more info.

Its a week 56 issue!!

Obviously wouldve been coded out had they not been in SA, but our manual and software calcs are indeed correct (which we knew!) and HMRC were wrong on their first call! h so annoying to waste so much time though. This should be flagged on our Agent accounts (as should it show what is behind the tax code) and a PTA! The former is a wish list (aint never gonna happen) the lack of it on the latter makes the thing totally pointless/redundant!

Ive come to the conclusion John that you should ring HMRC at least twice with any queries because generally you get one half assed response and one really helpful one. Drives you mad. At least with the agent line they answer quite speedily, so once youve answered their million and one questions about a client to ID them the call can be dealt with swiftly.

Oh and week 56 is an extension of a week 53 issue, which I have seen before.

Week 56 relates to four weekly paydays - a situation arises when there is an extra payday in the year, but with 4 weekly ones its apparently only every 22 or 23 years (Ive not checked the latter stats!!). In 2018-19 there were 14 payments rather than the usual 13, so the final payment is called week 56 (its week 53 for weekly, week 54 is for fortnightly). The problem occurs because the way the annual personal allowance is spread is via 52 weeks. What is doubly annoying in this case is that the client got a tax rebate via her payroll in the prior paypacket due to doing considerably less hours! Nil paid in week 56, so owes small amount of tax. Normally HMRC would code this out and usually isses a P800 to the cleint - this wouldve occured in this instance but timed to perfection as client set up her S/T business so it will pick up via S/A.

Given its all computer calculated and RTI'd these days Im not sure why they cannot cut some of these issues by allowing software to spread the allowance load, albeit this wouldnt help when folk change jobs.