How often do you check your tax code. 2 local government pension scheme pensioners checked their P60's for 08/09, and April 09 payslip. The codings had changed DOWNWARDS from 603L to 587L. The male (over65 in this tax year) should have increased to 949P, and the female (under 65) had changed from 603L to 587L, but should have been increased to 647L.
This particular pension payroll is one of many operated by a local authority.It is alerted electronically by HMRC, and covers over 14,000 public service pensioners. On 13 February 2009 HMRC issued the electronic instruction resulting in the incorrect codings. It took these 2 pensioners 6 weeks of individual appeals to HMRC to get them to acknowledge a mistake and correct the tax codes. Given that this instruction is contrary to the budget decisions on tax codings, the implications nationally for pensioners and workers on PAYE is really alarming, if this instruction was acted on widespread throughout local tax offices. How would we ever find out ?? In this case the male pensioner was incorrectly liable for tax at 20% on an extra 3620 of pensioner income, and the female was incorrectly taxed on an extra 600 at 20%.
So why not do what normally we all tend to ignore.....check your coding. For under 65's it should be a base line coding of 647L, and for over 65's 949P.
If you find a mistake, be vigorous ( you need to be) with HMRC...as getting the right result ain't easy..........and ................. contact your MP.
