HI All,
I’m in a right pickle – please help.
My dad has a spare room he rents out. Years ago he called HMRC and they arranged something so he did not have to fill in a SA and told him they would take his property income direct.
Today I see a letter that says ‘this is to tell you your tax codes(s) for the year 6 April 2017 to 5 April 2018’
Personal allowance
Less state pension
Less property income
NHS pension paymaster
From above you can see they are still using this property income in their calculations.
The trouble is I started to fill an online SA for him because the property income had changed. This was about 3 years ago! So I think he has been paying property income tax twice, they never stopped taking the other amount automatically.
It gets worse – when you use the online form it asks you if you get a pension. We click yes, as he does. There are 3 boxes, one asks your ‘state pension’, once asks for ‘other pensions’ and one ask the ‘tax taken off’. These boxes have magically been filled in already and are correct to the penny when checked against the paper work.
So we click calculate. It’s only today that I noticed it’s using his pension in this calculation and taxing him on his pension. BUT does he not already pay tax on his pension? He has always paid tax on his pension automatically (PAYE). (I think)
I have done this for 3 years. We have been paying tax on his pension and property twice??
Now I understand for the property maybe we should have called them to stop taking the money out, sadly we only noticed today. I don’t understand why is it trying to tax a pension, that as far as I know has already been taxed through PAYE?
Please help.
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