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Important news about your Personal Tax Account

HMRC offers many ways of dealing with tax through its website. The most important of which is the 'Personal Tax Account. It's a convenient way to manage tax credits and benefits and confirm details of your National Insurance number.

Personal Tax AccountNew services are being added all the time. From today (Monday, 1 August 2016) you can use your Personal Tax Account to check your end of year PAYE tax position and see if you’ve paid too much or too little tax.

PAYE tax is based on the information that HMRC hold. If that information is out of date or incomplete, tax collected over the year may be wrong. Each year the tax man carries out an end of year reconciliation for everyone and then writes to anyone who has paid too much or too little tax.

For the first time, if you've paid too much tax, you will be invited to fill out your bank details so that HMRC can pay back what they owe straight into your account.

Of course,  a Personal Tax Account won’t work for everyone. For those with slightly more complex situations, such as where you have nominated someone else to receive any repayment, or if you can’t get online, HMRC continue to offer their existing services.

Change in End of Year reconciliation letter

From Monday 1 August some of us may see a slight change to the end of year reconciliation letter (P800). If you'd like to see what it might look like, click here.

As you can see it encourages us to use our Personal Tax Accounts.

In the first two weeks of August, HMRC will test how this works with some of us who are due a tax rebate. Then, providing everything is working as it should, from 22 August, everyone who has paid too much tax will receive a letter inviting them to use their Personal Tax Account to get a rebate quicker.

Later this the year HMRC will introduce an online payment service for people who haven’t paid enough tax through PAYE.

Mark Hadley Design