Emergency tax

Haych

Despite assurances from my new employer that P45s are no longer needed and "it's all done online now", and that I wouldn't be placed onto an emergency tax code, guess what?

Yep!  I've been put on an emergency tax code!  HMRC have taken 22.7% of my entire salary this month, not to mention NIC.  So I'm down about £500, which I could sorely do with right about now.

Last time this happened was in 2013 and it took about 9 months to recover the overpaid tax.  Funny how it takes so long to get back anything overpaid, but don't you dare underpay or they'll demand immediate payment!

Anyone know what the deal is and the quickest way to resolve the issue, or do I just have to let the system do its thing and wait for a tax refund?

My previous employer hasn't sent me a P45 yet, possibly because they still haven't processed my final salary payment.

Sporky

I had this once - HMRC decided I sill had my previous job, and took over 80% if my first month's salary. My new employer did a cash advance and sorted it out with HMRC.

I would speak to the finance and/or HR people. 

munckee

I get decent bonuses once a year, so the inland revenue puts me on an emergency tax each time thinking my salary has gone up 1000%, then I get it back over the rest of the year.  

guitarcookie1

Login to your personal tax account & see if you can sort it there, or ring HMRC, explain the circumstances & get them to change your tax code.

mrkb

Wouldn’t Aprils pay be based on a new tax year allowance anyway, so previous P45 wouldn’t matter.

rlw

mrkb said:

Wouldn’t Aprils pay be based on a new tax year allowance anyway, so previous P45 wouldn’t matter.

This.

There's no difference as far as I know in the emergency code - 1257L M1 - and 1257L, except that one is cumulative and one isn't, but that has little effect normally.

Unless you have a much higher coding of course.

Haych

They've put me on 0T (W1/M1)

¯\_(ツ)_/¯ 

Philly_Q

Haych said:

They've put me on 0T (W1/M1)

¯\_(ツ)_/¯ 

It's a long time since I did any payroll, but I think that's what they do when they think someone has a second job and all their allowances are being used elsewhere.

mrkb

Understanding your employees' tax codes: What the letters mean - GOV.UK (www.gov.uk)
OT means no tax allowance!

RedRabbit

Philly_Q said:

Haych said:

They've put me on 0T (W1/M1)

¯\_(ツ)_/¯ 

It's a long time since I did any payroll, but I think that's what they do when they think someone has a second job.

It's more just that whoever is processing the payroll hasn't had the P45 info or a coding notice from HMRC. 

Might be worth OP logging onto his HMRC account (or creating one if need be) and checking to see if a new coding notice has been issued that he can pass onto payroll.  They might not be able/willing to re-run this month but it should ensure that the correct tax code is used going forward and that the overpaid tax is reclaimed.

Haych

RedRabbit said:

Philly_Q said:

Haych said:

They've put me on 0T (W1/M1)

¯\_(ツ)_/¯ 

It's a long time since I did any payroll, but I think that's what they do when they think someone has a second job.

It's more just that whoever is processing the payroll hasn't had the P45 info or a coding notice from HMRC. 

Might be worth OP logging onto his HMRC account (or creating one if need be) and checking to see if a new coding notice has been issued that he can pass onto payroll.  They might not be able/willing to re-run this month but it should ensure that the correct tax code is used going forward and that the overpaid tax is reclaimed.

It's annoying because when I started with the company I told HR that I didn't yet have my P45 and I offered to fill in a New Starter Checklist HMRC form, but they stated it wasn't needed as everything is done online.

I've logged into my HMRC account but don't really know what I'm looking at.  It tells me that for last tax year (April 2023 - April 2024) my tax hasn't been calculated yet.

I've just emailed payroll so will see what they have to say about it, if anything.  I'm not expecting anything useful, I seem to recall from my last experience that this is a complete ball ache to rectify!

rlw

That’s a fuck up by your payroll people.

tony99

Going to depend on what month the tax was taken to determine when you get it back.

The main problem with P45 having not been issued is not that the new employer will need it, but to HMRC records it will appear that you still have your old job and so that's where your normal (better) tax code will still be allocated. Phone 'em up, explain that you want your new job to be the primary, they'll switch the code and cease your other job.

They should be able to process any refund once your P60 is in. If more tax was taken for month of April, then you'll need the P45.

CavemanGrogg

Consider yourself extremely luck, emergency tax used to be 75% not that long ago, and that was extremely painful to pay, and even more tooth pilling painful to get back, and you only have 10 years to get it back, otherwise HRMC considers you to have given up all claims to the money.

euan

This is going to be me next month. When I last got emergency taxed the fuckers just adjusted my tax code so I got it repaid it over the tax year rather than reimbursing me which was brutal. 

tony99

euan said:

This is going to be me next month. When I last got emergency taxed the fuckers just adjusted my tax code so I got it repaid it over the tax year rather than reimbursing me which was brutal. 

To be honest you'll probably find the same happens again. Sorry bud.

euan

Yeah fully expecting it. 

m_c

I got a tax refund via my new employer last month, as due to being unemployed for a few months, I never used all my personal allowance, so it got corrected in last months pay.

The issue is until your old employer processes your final pay, issues your P45, and updates HMRC, any new job is assumed to be a second job.

tony99

m_c said:

The issue is until your old employer processes your final pay, issues your P45, and updates HMRC, any new job is assumed to be a second job.

Yeah but you can call them and change that.

ESBlonde

Get your old employer to ‘process’ your final pay cycle and everything else will follow. If you’ve left then it’s due then or no later than your normal pay cycle ( month end). No excuses!

Haych

I think the payroll cycle of my new place overlaps the old one. 

The old runs payroll on the 28th, the new one on the 19th, so may have to wait until next week for the old payroll to be fully finished.