State Pension 1st year tax liability

[Anderton]

I have just received a HMRC P800 calculation advising I owe them an amount of tax for 2016/17 tax year. I started receiving my state pension in July 2016 and it turns out that the discrepancy is due to HMRC using my state benefit entitlement for the tax year instead of the lower figure of actual state pension received due to being paid 4 weekly in arrears. i.e. I received the last 3 weeks of my 2016/17 state pension entitlement in the first payment in the next tax year 2017/18. HMRC have advised that I must obtain confirmation of state pension received in 2016/17 from DWP before they will amend their records.
When I contacted the DWP verbally I was told that DWP could only confirm my state pension entitlement for 2016/17 and that it was right that I had to pay tax on the full amount in tax year 2016/17 - I am awaiting this to be confirmed in writing.
Does anyone have any experience of this situation ? Its only a relatively small amount of just over £100 but why should I have to pay tax in 2016/17 for income received in the following tax year ?

[JRG]

Everyone who receives the State Pension has this problem. This occurs in every tax year where the first 4-weekly payment is made up of some weeks at the previous tax year's rate and some weeks at the current tax year's rate. In this case, when the DWP advises the HMRC of the current year's pension at the current year's rate, this will always be more than is actually received.

I get round this problem by completing a self-assessment tax return (SATR) every year, in which I show the ACTUAL amount I receive, with an explanation of why it differs from the DWP's amount.
Those who don't complete a SATR should write to/contact HMRC, with the above explanation and request a tax refund.

[robbob]

HMRC have advised that I must obtain confirmation of state pension received in 2016/17 from DWP before they will amend their records.
When I contacted the DWP verbally I was told that DWP could only confirm my state pension entitlement for 2016/17 and that it was right that I had to pay tax on the full amount in tax year 2016/17 - I am awaiting this to be confirmed in writing.
Does anyone have any experience of this situation ? Its only a relatively small amount of just over £100 but why should I have to pay tax in 2016/17 for income received in the following tax year ?

If hmrc are not proactively sorting this after you have had discussions with them and dwp this is a disgrace, anyway to me the DWP should confirm what you actually had in the tax year and that is all you will pay tax on - its as simple as that - hmrc have the date of retirement normally on their systems so if they are not obliging simply get dwp to put their bit in writing (even if thats a refusal)and pass that onto hmrc as a formal complaint. Personally i would ring hmrc and if they cant sort it raise a formal complaint call back from there. If you have your documentation confirming start date of pension and weekly amount that should be reasonable proof from hmrc.


Don't be afraid to mention the taxpayers charter when they complain
https://www.gov.uk/government/publicati ... ur-charter

They say

1.1 Respect you and treat you as honest
We’ll treat you even-handedly, with courtesy and respect. We’ll listen to your concerns and answer your questions clearly. We’ll presume that you’re telling us the truth, unless we have good reason to think otherwise.

1.2 Provide a helpful, efficient and effective service
We’ll help you understand what you have to do and when you have to do it. We’ll deal with the information you give us quickly, efficiently, and keep any costs to you at a minimum. We’ll put any mistakes right as soon as we can.

So if you point out their P800 is wrong and why i would expect them to correct to your calculated figure unless they have evidence you are wrong.

Unfortunately it often takes something to be written down before they can look at the info and get to the correct answer.