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Your responsibility regarding HMRC Tax codes
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Your responsibility regarding HMRC Tax codes
26/04/2023.
Not many employed people worry about their tax coding notices unless they find that too much tax is being deducted from their wages.
Not many employed people worry about their tax coding notices unless they find that too much tax is being deducted from their wages.
But did you know that it is your responsibility to check and ensure that your own tax coding is correct and being operated by your employer? It is not your employer’s responsibility to check your coding notice is correct, only to operate the code that has been given to them. They have no choice but to operate the code they are given.
The consequence is that your tax code may be incorrect for a whole tax year, resulting in either over or under deduction of tax from wages. Once the year is complete and you either enter your P60 data onto your self-assessment tax return or, HMRC run a calculation you may find that you have significantly underpaid tax during the year. The tax that you thought was taken care of at source was not and you have a tax bill at the end of the year. This can come as a shock particularly if the tax liabilities become larger as might be the case for those with larger salaries – a small difference throughout the year can add up to a significant amount by the end of the year and result in an unpleasant surprise when the tax bill arrives.
Check your coding notices when they arrive. If there is something that seems out of place, check with your adviser or you can check and change things yourself if you set up a personal tax account with HMRC, you can find the portal here.
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