Problems with PAYE notices of coding 2010-11

April 2010

HMRC have belatedly realised that a significant number of the Notice of Codings issued for 2010-11 are incorrect. One unfortunate consequence is that whilst you may have been sent a revised, corrected code number, your employer may not. Employers cannot change their payroll records unless they are formally sent a copy.

This is likely to affect the following groups of tax payers:

Pensioners and those receiving State Benefits
Those with company car and possibly car fuel benefit
Those on incomes over £100,000 who may continue to receive their full personal allowance when they should not.
Taxpayers who had one-off deductions from their 2009-10 code number, underpayments of tax for previous years, one-off benefits and so on.

There is a danger that if you are affected you will pay too much, or not enough tax in 2010-11, at least until your code number is corrected.

If you are concerned and have recently received a corrected code number for 2010-11, be sure to speak with the person or department that operates your employers PAYE - you need to ensure the code number they will use for April 2010 onwards is the latest code number you have received.

Of course even the corrected code may be incorrect! Please call if you would like us to check your Notice of Coding.