11:57am Monday 8th February 2010
A GLITCH in a new computer system has caused HM Revenue and Customs (HMRC) to send out thousands of incorrect PAYE codes to UK taxpayers.
Your PAYE code tells your employer how much income tax they should deduct from your wages between April 2010 and April 2011. If you are in part-time or full-time employment, your PAYE code will be sent to you between January and March of this year to be checked by you before it gets forwarded onto your employer.
If you are unsure of what your code should be, visit the HMRC website to check your tax-free entitlement.
We tend to assume that the information we receive from the taxman is correct, but I would urge all taxpayers to double-check their PAYE code when they receive it this year.
Failure to do so could result in people paying almost £1,300 too much in tax over the year – which all of us could do without in these tough economic times.
Chas Roy-Chowdhury, Head of Taxation, Association of Chartered Certified Accountants, London.
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