HMRC Tax Underpayment- Employer saying I earned more than I did

[turnaround552]

Hello everyone, this is my first post!

 

I'm currently a student at uni, prior to starting uni whilst I was at school I had a job for Youngs doing the washing up in one of their pubs. I worked 7 hours a week on £7ph so I earned around £2500 a year. I have however received a P800 from HMRC saying that I under paid tax by £575 whilst I was there. I asked for further info and they sent me a breakdown of the figures that said I earned £14500! This is absolutely false! I rang Youngs and they said on their system it had me down as earning that much. The trouble is that I was paid in cash each week by my manager so I never received any payslips/official documents.

 

I'm really unsure what to do as it seems I can't prove that I only did 7 hours a week washing the dishes! (They've obviously put me down as a full time barman or something) The manager I worked for has left the company although I could get in contact with him and ask him to write to Youngs with the hours I actually worked?

 

I also think that surely Youngs must be able to prove that I earned that much- i.e through payslips, P60s or records of account transfers. I'm perfectly willing to open up my accounts to HMRC and they will be able to see that no transfers from Youngs were ever made (unless they propse that they paid me £1200 in cash each month!)

 

Anyway, any thoughts on the matter would be really helpful as I really can't afford to pay nearly £600 of tax that I don't even owe! (poor student and all that)

 

Thanks guys

[Gbarbm]

Hi

Gosh what a nightmare!

Right well first things first you need to appeal to HMRC against the assessment on the grounds that the amount of income is incorrect.

When you applied for the job, did you receive anything from the company which stated your job title, hourly rate etc?

[turnaround552]

hey there, no I didn't get anything when I started! I just got my weekly pay direct from the manager. Also as well as saying I earnt more than I really did, it also says I paid over £1000 in tax for that year (which I didn't!) they have got everything wrong! As far as launching an official appeal, do I ring/write to them stating im officially contesting the decision?

[Gbarbm]

Yes put it in writing and send it by recorded signed for delivery to the address on the letter you received.

Just so you are aware, HMRC will check the tax/NI paid over by your employer by reference to their BROCS (business records on HMRC systems) records.

They will then check the amount paid as wages in the company accounts and also the P60 details. It will be difficult with no paperwork though; did you ever get a P60?

You do need this sorted, I'm not saying this to cause upset, but it's possible that because of the lack of paperwork, HMRC may think there's been employee/employer collusion, so it's in your own best interest to gather as much information as you can as HMRC will need to establish how much NI is due/has been paid because it needs to be paid into your NI account in order to protect your future entitlement to benefits and state pension.

If the employer has not paid this over, HMRC can make the employer pay it on your behalf

[turnaround552]

sorry my reply has been so long- correspondence takes a while with HMRC! I wrote a letter to contest HMRC's findings however I received a letter from them saying they had investigated and that XXX provided the 14k figure to them again. They also said they wouldn't investigate it any further and that if I thought the pay amount was wrong then I would have to take it up with them.

 

I have called XXX and asked them to provide me with the documentation they have for me and they have sent me every weekly pay slip for when I was there (none of which I have ever seen!), these pay slips, far from saying I worked 7 hours a week in fact say I worked 50 hours a week. It also says I was paid the £250 (minus tax and N.I deductions) in cash each week. I'm really not sure what can be done, these figures are so wrong but I've only just found out about them so is there anyway to prove they are wrong?

Edited September 25, 2012 by Gbarbm
Name of company deleted

[Gbarbm]

Were you paid by cash, cheque, BACS or CHAPS?

 

If you were paid by cheque, BACS or CHAPS then evidence of the amounts can be obtained from your bank statements.

 

Cash payments will be nigh on impossible to trace I'm afraid.

 

I would certainly write back to them and tell them that you dispute their figures on the grounds that this is not what you received.

 

Another thing you could do is contact the NI office and ask for a postings printout showing the amounts of NI paid over

 

P.S I have edited out the name of the company

[turnaround552]

It was in cash, and on the pay slip it says I was paid £250 minus deductions in cash. Even if I was to have received the amounts claimed on the payslips should I still have to pay back any tax owed as XXX company was supposed to have deducted the right amount before I received the cash- shouldn't the owness be on them? HMRC say the error was down to a duplication in tax allowance or something. Also do you think I could launch a claim in the small claims court for negligence on the part of company XXX? I could get my old manager and other members of staff to attest to the 7 hours I worked a week. I could also get school records to show I was in full time education, attending school 9am to 4pm Mon-Fri and so I couldn't possibly have worked 50/60 hour weeks which is what the payslips claim?

[Gbarbm]

Good idea about the school records; proof that you could not have worked those hours!

Write back to HMRC with this info and tell them that the error is on the part of the employer and they should pay any tax due... It sounds to me as if the employer is up to no good and I don't get what HMRC are on about with the duplicate allowances, that would only apply if you had two sources of income.