Martin Lewis gives advice on checking your tax code
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Anyone who has claimed Home Office Relief will need to clarify whether HMRC has included the relief, according to tax and advisory firm Blick Rothenberg. At the same time, they should also check whether they are on the right tax code, otherwise they could end up overpaying by thousands.
As many as 800,000 people made a claim between April and June 2021, but many won’t have checked whether the HMRC has included it.
Robert Salter, a client tax director at Blick Rothenberg said now is the time for people to check.
He said: “Employees should be reviewing their PAYE tax codes to clarify whether HMRC have included the home office relief within the notice of coding.
“If this is the case, unless they are still eligible for the relief in 2022/23 – they should contact HMRC to get the notice of coding corrected.
“Otherwise, they will have additional tax to pay at the end of the tax year.”
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Meanwhile, people are also being urged to check their tax code to see if they are paying the right taxes.
Tax code 1257L covers the majority of the working population and has replaced the 1250L tax code.
HM Revenue and Customs allocates these tax codes but there is always the potential for error.
Typically, employees who earn between £12,570 and £50,271 will be on the 1257L tax code.
The 2021/2022 tax year ended at the beginning of April, meaning now is a good time for people to check their tax codes.
Recently a taxpayer took to Reddit to warn others to check their tax code after realising they had been overpaying for more than a decade.
Reddit user “Scoggy” said: “I have simple PAYE tax affairs, and feel very stupid for not paying attention to my tax code.
“I changed jobs in December 2009. In my old job I had private medical insurance, and don’t in my current job.”
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The Reddit user continued: “This month I found out by chance that my tax code has included £918 medical insurance for each year since 09/10.
“I was gutted as it means I’ve overpaid tax for 12 years.”
Although they reported the mistake to HMRC and received a refund of £1,800 this was a drop in the ocean compared to the overpaid tax sum of more than £11,000.
Scoggy urged others: “Moral which I think everyone but me already knew: check your tax code!”
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