PAYE Coding Notice - What are HMRC UP to?

[SueEllen]

Are you serious?? Surely this is an ideal primary key

Causes:
1. Human error in giving out the numbers I actually met someone who had been given the same number as someone else. They got given their NI number as an adult in their mid-twenties when they came over to work here. I was told this use to happened a lot by a relation who is an accountant.

2. Fraud - some illegal immigrants use other people's NI numbers so they can work.

3. Official line - Transcription errors - if you design a system to give out numbers you should design it so that numbers that are easily swapped aren't given out.

[Clare@InTouch]

Are you serious?? Surely this is an ideal primary key

It's mainly due to transcription errors apparently.....


National Insurance

Chris Grayling: To ask the Secretary of State for Work and Pensions how many duplicate national insurance numbers there are in the national insurance database. [149969]

Mr. Plaskitt: From March 2007, DWP’s Customer Information System replaced the Departmental Central Index as the national insurance database. Due to the way the Customer Information System is set up, the same national insurance number cannot be allocated twice. However, from time to time we identify national insurance numbers that are being used by more than one person, usually through transcription errors.

The number of instances where this has occurred is shown in the following table.

Cases of a national insurance number being used by more than one individual

Number of cases
2001 2,539

2002 2,418

2003 2,533

2004 1,896

2005 1,991

2006 1,984

Note: In these cases we take corrective action with Her Majesty's Revenue and Customs (HMRC) to correct the account.

House of Commons Hansard Written Answers for 17 Sep 2007 (pt 0029)

[MrRobin]

1. Mixed you with someone else - NI numbers are not all unique

Are you serious?? Surely this is an ideal primary key

[tractor]

..

I never knew that - that is insane - can you imagine a bank saying "oh, our account numbers are not unique"!

There could be hundreds of people running around with the same NI number as you..true story.

[Clare@InTouch]

Nope. Definitely 100k. All sorted now.

I've seen that on a recent coding notice, they think you're going to earn over £100k so they adjust your personal allowance downwards to reflect it (as you lose your personal allowance once you go over that level of income).

HMRC adjust coding notices all the time, often after processing tax returns or P11Ds, and it's just a simple case of calling them to get it corrected. They will usually agree to adjust it back if you file a tax return each year as any difference will be dealt with there. It's only if you're fully PAYE that these things have to go through the code.

[SneakySimon]

Interesting

HMRC mistake.


They have either:
1. Mixed you with someone else - NI numbers are not all unique, or

I never knew that - that is insane - can you imagine a bank saying "oh, our account numbers are not unique"!

[prozak]

I have never seen a coding adjustment for £100,000 - are you sure it was not for £10,000?

HMRC have picked up on that you have declared 'investment income', probably dividends on your last tax return. Due to the fact that HMRC do not get their hands on any extra tax for quite a while, they often choose to alter your tax code to try and get some of the funds up front.

Assuming that you take a lowish salary anyway, this tactic will have little effect and the tax take will be relatively small.

As someone who prepares a tax return, the effect is just cashflow - it will not change the total tax due for the year.

Personally, I would not get too worked up about tax coding notices as the correct tax position will be established when you prepare your personal tax return.

Finally, you can request that HMRC remove this adjustment if you wish.

Alan

Nope. Definitely 100k. All sorted now.

[prozak]

Similar thing happened recently with my own tax code, and seems to be a common occurrence of late.
I advised my accountant of the discrepancy, who then contacted HMRC & dealt with it. That's what I pay them for after all.

Yes I was about to say that people should expect similar.

Apparently there was some system outage and copy of data that happened. They added the income from my paye code to my recent SA return or something... so effectively double counting my income and thinking I was pushing the 100k bar.

All sorted now.

[SteelyDan]

Similar thing happened recently with my own tax code, and seems to be a common occurrence of late.
I advised my accountant of the discrepancy, who then contacted HMRC & dealt with it. That's what I pay them for after all.

[Nixon Williams]

Just received this coding notice.

Your new tax code for the year 6 April 2011 to 5 April 2012 is 321T, which replaces 747L.

Personal Allowance - £3214 (note 1)

1. .....We estimate your total income for the year will exceed £100000.00.

Wtf?

How do they get this?

I've done two Self Assessments since I came back to the light as a contractor. Most recent one submitted the other day. Both are pretty much spot on the 40% threshold.

My company has never even exceeded 100k in revenue as for various reasons (different company used, minor flirtation with one of those schemes) I've never used it for a full tax year yet - this year will be the first time it does.

Is this just a mistake or are HMRC lining me up for something worse in a few weeks?

I have never seen a coding adjustment for £100,000 - are you sure it was not for £10,000?

HMRC have picked up on that you have declared 'investment income', probably dividends on your last tax return. Due to the fact that HMRC do not get their hands on any extra tax for quite a while, they often choose to alter your tax code to try and get some of the funds up front.

Assuming that you take a lowish salary anyway, this tactic will have little effect and the tax take will be relatively small.

As someone who prepares a tax return, the effect is just cashflow - it will not change the total tax due for the year.

Personally, I would not get too worked up about tax coding notices as the correct tax position will be established when you prepare your personal tax return.

Finally, you can request that HMRC remove this adjustment if you wish.

Alan

[prozak]

Thanks.

I hope so. Will call tomorrow and try and be nice.

I must get around to asking for my money back from 2005/2006 (spent most of the year being a sailing bum) as well. May as well bring it up on the same call. Though I might be too late by now.

[SueEllen]

HMRC mistake.


They have either:
1. Mixed you with someone else - NI numbers are not all unique, or
2. Had a computer error i.e. some f***wit pressed the wrong button

[prozak]

Just received this coding notice.

Your new tax code for the year 6 April 2011 to 5 April 2012 is 321T, which replaces 747L.

Personal Allowance - £3214 (note 1)

1. .....We estimate your total income for the year will exceed £100000.00.

Wtf?

How do they get this?

I've done two Self Assessments since I came back to the light as a contractor. Most recent one submitted the other day. Both are pretty much spot on the 40% threshold.

My company has never even exceeded 100k in revenue as for various reasons (different company used, minor flirtation with one of those schemes) I've never used it for a full tax year yet - this year will be the first time it does.

Is this just a mistake or are HMRC lining me up for something worse in a few weeks?