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Letters will be dropping onto around 1.2 million doormats over the next three months warning people they have underpaid their tax, with the average amount owed expected to be £550.
Leading Peterborough accountancy firm Rawlinsons, based in Lincoln Road, is now keen to reassure people they won’t be required to pay the amount owing as a lump sum. Instead HMRC will, in most cases, recover the debt by altering the tax paid in the next financial year.
The annual review of tax payments saw HMRC refunding an average of £340 to around 3.5 million tax payers who had overpaid in the year to April 2011.
That process was completed at the end of September and the government will now begin contacting those who have underpaid. Form P800s will be sent to those people affected and tax codes for the year 2012-2013 reduced accordingly.
“This is part of HMRC’s regular conciliation of UK taxpayers’ PAYE records,” explained Rawlinsons partner Ken Craig. “While any overpayment is refunded, underpayments are generally collected by changing the relevant tax code for the coming year.”
This year has seen a reduction in the amount of underpayment written off from £300 to just £50.
“For that reason we expect more people than usual to be alerted in respect of an underpayment,” said Ken. “We are now working with clients to prepare them for compliance.”
For more information about how to ensure you are on the correct tax code please call Rawlinsons’ Tax Team on 01733 568321 or email email@example.com.
Editors note: For more information, or to arrange interviews, please contact Suzanne Ostler at Media Matters on 01733 371363 or email Suzanne@mediamatters-pr.co.uk