This Content Was Last Updated on November 5, 2015 by Jessica Garbett


Most people cannot fail to have heard of or read about the imminent issue of underpayment and overpayment notices following the introduction of the new HMRC PAYE system. The majority of our clients should not be affected by this. However, where an individual has more than one source of income, e.g. 2 employments or a pension and an employment, you may have fallen foul of this HMRC fiasco.

For those that receive an overpayment notice, you may feel this is good news, but the figures do still need to be checked. Please let us have a copy of any notice you receive.

Where an underpayment has arisen, HMRC are not demanding the repayment of the outstanding sum immediately. Their plan is to collect it via next year’s tax code and via the following year’s code as well, in cases where the underpayment is over £2,000.

For those that receive an underpayment notice, again, the figures need to be checked. HMRC are not known for always getting it right – the same computer that made all these errors in the first place is the one that is issuing these new notices. Even if the figures turn out to be correct, an appeal can be sent in on the basis that the individual believed HMRC had all the necessary information to get it right and the individual was unaware at the time that they had not dealt with it correctly. There is an extra-statutory concession that can be claimed, although this is discretionary on the part of HMRC. This concession has been well publicised in the press so it is highly likely that HMRC is going to receive a great many appeals against these notices.