What should you do if you’ve received a P800 for overpaid or underpaid tax?

What should you do if you’ve received a P800 for overpaid or underpaid tax?

Date13 Aug 2015
Posted ByAdmin

As part of its continued efforts to help and support PAYE taxpayers get things right, HMRC has started the annual End of Year Reconciliation process that will continue until October 2015.  The process compares the tax that is paid with the tax that is due as per information on HMRC’s records.

If you think you’ve not paid the right amount of tax for the 2014-15 tax year, you can expect to receive a P800 tax calculation by the end of September through post. This will show whether you need to pay more tax or get a tax refund (rebate). 

Note: Tax payers that are registered for self-assessment won’t receive a P800 - their bills will instead be adjusted automatically.

Why have I received a P800?

To ensure you have paid the correct amount of tax HMRC collates and reviews all your income and PAYE information it receives from employers, pension providers and banks. Mostly, the calculations are correct and you won’t receive a P800. However, sometimes HMRC finds some discrepancies in the amount of tax paid and will send out a P800 tax calculation letter if it deems you've overpaid or underpaid tax.

There are various reasons why you could receive such a letter. Some of these are:

  • change in jobs within the same month
  • signing-up for pension scheme at work
  • receiving Employment Support Allowance or Job Seekers Allowance

What should look for on the P800?

Firstly, check if the details on the P800 are correct. You can:

  • Compare HMRC’s figures with you own records , for example your P60, P11d, bank statements or letters from the Department for Work and Pensions (DWP).

If the figures are right then you don’t need to do anything.  But in case you think HMRC has not used the right figures check how much you should have paid using the HMRC tax checker.

What if you’ve underpaid?

If you’ve paid less, the underpayment will be collected automatically through the 2016/17 tax code. As this happens automatically you don’t need to do anything. In case you are out of work HMRC won’t be able to collect the money you owe through your tax code. In such situations HMRC will write to advise what options are available.

What if you’ve overpaid?

If you are paying too much you will receive a cheque for the overpayment within 14 days of submitting the P800 tax calculation.

If you have received a P800 and are worried about any of the points above, please contact Practice Manager, Alan McCappin, on 020 8303 1287 or email contact@bradleysaccountants.co.uk for a confidential, no cost and no obligation discussion in relation to your tax problem.