 | THE TAX MAN COMETH! | | | | | The Changes May Affect You ... | Posted by Nigel Adams on 03/02/2012 @ 08:30 |
Regulations came into force on 20 July 2011 to permit additional method of recovery for self-assessment debts and tax credit overpayments. This means that from April 2012, HMRC will be able to collect small debts up to £3,000 through Taxpayers' PAYE codes ...
 make sure you understand changes from hmrc which affect you
Last summer, the Taxman began to send letters out to selected self-assessment Taxpayers with outstanding debts and then to Tax Credit claimants with overpayments due for direct recovery. The letters notify recipients that money owed can be collected through their pay by reducing their PAYE code; a statement of liability is enclosed with each letter which shows a summary of the debts, interest accrued to date and the daily interest accrual rate. Accrued interest will be dealt with separately and will not be collected through the tax code reduction.
If the Taxpayer does not wish to have his or her code reduced, the individual's Tax Adviser should contact the Revenue to discuss payment by an alternative method. This is also the case if having the debt coded out would cause hardship. HMRC say that the same safeguards that exist to prevent excessive deductions from salary via PAYE will apply to the coding out of debts.
There is a priority order for including in a tax code sums owed: PAYE underpayments and income tax liabilities resulting from information in a self-assessment return will be allocated in the code ahead of debts.
Sometimes navigating your way through tax affairs can seem a little less than straightforward, so please talk to us on +44 (0) 1908 219100 if you need some clarification on this or any other related matter.
Until next time ... 
NIGEL ADAMS
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 | MANAGING DIRECTOR Nigel formed Ad Valorem in April 2001 with a commitment to working with companies of all sizes, just the one common goal though the ambition to succeed and make the best of every opportunity that is presented.
Nigels strengths are thinking outside the box and using his practical and down-to-earth approach to help business owners maximise their potential. He will tell you what you need to know but not baffle you with accounting jargon.
Ad Valorem continues to grow and still fosters the family atmosphere with both its team and clients that is core to his business vision.
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