CIOT: Low Income Tax Reform Group - Tax experts issue updated guide to underpaid tax letters

CIOT: Low Income Tax Reform Group – Tax experts issue updated guide to underpaid tax letters

CIOT: Low Income Tax Reform Group – Tax experts issue updated guide to underpaid tax letters

The Low Incomes Tax Reform Group (LITRG) have updated and reissued their guide on what people should do if they receive a tax calculation letter (form P800) from HM Revenue and Customs.

HMRC have now started sending out the main bulk of calculations to people who they think have overpaid or underpaid tax through PAYE during the last two tax years 2008/09 and 2009/10. Between now and Christmas they expect to send out some 1.4 million underpayment and over 4 million overpayment calculations.

The full guidance is available on LITRG’s website at www.litrg.org.uk.

Introducing the guide, John Andrews OBE, Chairman of LITRG, said:

“Just because HMRC send you a P800 calculation doesn’t mean to say that the figures it shows are right, or that you have to repay any underpayment shown.”

He went on to summarise the main points of LITRG’s advice to taxpayers:

“First, check the calculation to make sure it is correct, and if you find any errors, or are in doubt, contact HMRC.

“Next, if the statement shows you owe tax, consider whether you have to pay it back. It could be too late for HMRC to be entitled to assess it; or it could be down to your employer’s or pension payer’s error, in which case they (not you) are normally liable for any underpaid tax.

“Finally, consider whether HMRC ought to write off the tax under their concession A19, or under their complaints procedure.

“If all else fails, HMRC ought to be prepared to give you time to pay. It was, after all, their delay that caused the unpaid tax to mount up. But do take care in negotiating payment terms with HMRC as your entitlement to means-tested benefits could be affected.”

Notes to editors

1. LITRG are keen for the guide to have the widest possible circulation and media outlets are encouraged to link to it and to reproduce extracts from it, provided these are attributed to LITRG.

2. Experts from LITRG are available for interview or to provide background information. Please contact them via the numbers at the top of the page.

3. The Low Incomes Tax Reform Group (LITRG) is an initiative of the Chartered Institute of Taxation (CIOT) to give a voice to the unrepresented. Since 1998 LITRG has been working to improve the policy and processes of the tax, tax credits and associated welfare systems for the benefit of those on low incomes.

The CIOT is a charity and the leading professional body in the United Kingdom concerned solely with taxation. The CIOT’s primary purpose is to promote education and study of the administration and practice of taxation. One of the key aims is to achieve a better, more efficient, tax system for all affected by it – taxpayers, advisers and the authorities. The CIOT’s 15,000 members have the practising title of ‘Chartered Tax Adviser’ and the designatory letters ‘CTA’.

– ENDS –

George Crozier
External Relations Manager

D: +44 (0)20 7340 0569
M: +44 (0)7740 477374

The Chartered Institute of Taxation
www.tax.org.uk
Low Incomes Tax Reform Group
www.litrg.org.uk
The Association of Taxation Technicians
www.att.org.uk

1st Floor, Artillery House, 11-19 Artillery Row, London SW1P 1RT