‘Check Your Payslip’ Warns Nurse Who Overpaid Nearly £3k in Tax
A nurse has come forward with a crucial warning: Check your tax code on your payslips. Gemma Belby, from Barry, Vale of Glamorgan, discovered that she was unintentionally overpaying income tax—almost double what her colleagues were paying—after discussing their salaries.
– Discovery of Overpayment: Belby stumbled upon the issue during a conversation with coworkers about their back pay following a new pay deal for nurses. She noticed a significant discrepancy in the amounts they received compared to her own.
– Tax Code Mismanagement: After raising the issue with HM Revenue and Customs (HMRC) in October, it took three months for her overpayment to be rectified, resulting in a refund of nearly £3,000. This long process took a toll on her health due to the stress it caused.
– HMRC’s Response: HMRC acknowledged the error, stating, We apologize to Mrs. Belby and can confirm that we’ve corrected her tax code and issued a refund. While most repayments are processed promptly, more complex cases can take longer.
– Personal Accountability: It is essential to remember that the responsibility for ensuring accurate tax payments lies with the individual.
– Christmas Disappointment: Belby, a mother of four, had hoped to receive her refund before Christmas to spend on her children. She recounted feeling tearful and frustrated, particularly when faced with mixed messages regarding the total amount she was owed.
– Conflicting Information: Initially, on January 19, she was informed she was entitled to a refund of £8,194.96 for the tax year 2024-25. Shortly after, she learned this figure was incorrect and needed to be recalculated based on her P60, a document detailing tax payments for the year. Had they calculated the refund using my P60 when I first contacted them in October, I could have received my money much sooner, she said.
– Final Outcome: After the recalibration, HMRC confirmed she was due a refund of £2,863.04, which she received at the end of January.
The Importance of Checking Your Payslip
Belby’s experience highlights the crucial message: always verify your tax code. She urges others to take the necessary steps to avoid similar financial strain, asserting that if it happened to her, it could easily happen to anyone.
How to Check Your Tax Code
– Understand Your Tax Code:
– A tax code dictates how much income tax is deducted from your salary or pension.
– For most people with a single job or pension, the common tax code is 1257L, allowing earnings up to £12,570 before taxes kick in.
– If you receive company benefits, this figure might be lower.
– Regional Differences:
– In Wales or Scotland, tax codes generally begin with a C or S.
– Utilize HMRC Resources:
– Use the HMRC tax code checker to verify your code.
– Setting up a personalized tax account is an excellent way to monitor your details.
Expert Advice on Tax Codes
Financial expert Martin Lewis emphasizes the need to check your tax code now. He warns, Millions of them are incorrect annually. It’s your responsibility to ensure it’s accurate. A wrong tax code can lead to overpayment or a hefty tax bill when you least expect it.
Lucy Cohen, co-founder of online accounting firm Mazuma, explains the variety of factors that can lead to incorrect tax codes. Errors can arise from administrative mistakes or misissued codes.
An HMRC spokesperson reiterated that customers can check and update their tax codes via the HMRC app or online account and encouraged discussions about tax code concerns with employers.
In conclusion, Gemma Belby’s ordeal serves as a powerful reminder for all employees: Check your payslip regularly to ensure that you’re not overpaying taxes and to safeguard your financial well-being.