Income declaration and employer didn't pay taxes

[Khubaib]

Hi,
I worked as an employee and was self employed in 2011-12.
I forgot to declare the salary for 2 months in my tax return as I switched jobs. I can't believe I forgot
Today, I received a letter from HMRC that they want to investigate my "tax and pay from employment"
So I checked my records and found P45 and states:
Income:£2000
Tax to date:£26
But I only got £820 paid each month as per my bank statement. What I think is that employer didn't pay my taxes and now HMRC is demanding tax of me?

What shall I do? Can they tax me because employer didn't pay tax as my bank statements prove that my tax was deducted at source? Is it my liability? What excuse/reason shall I provide Tax office for not declaring this income?

I'm stressed and don't know what to do.

Please advise.
Thanks in advance.

[LozaACCS]

The enquiry will have arisen because you have not declared the income on your tax return, there may or may not be tax to pay as a result of the error.
The error will be deemed careless and a potential penalty arises based on the Potential Lost Revenue (PLR) which will be between 15% and 30%.
If you cooperate with HMRC and provide help and information to resolve the issue it will be 15%.
Clearly if there is no tax to pay as a result of the disclosure there will be no penalty.
You need to amend the return for 2011/12 or get an accountant to do it for you.

If the ER has not accounted for the tax to HMRC that will be a separate issue but will not directly concern you unless NI contributions have not been declared in which case you would need to contact the NI contributions office with a view to having them credited to you.

[Khubaib]

Thanks for your reply Loza. I'll definitely help Hmrc resolve this issue.
Shall I just ask my accountant to amend the return or resolve this issue with Hmrc first.
If my accountant amends my return according to figures on P45, then I'll have to pay more tax where as the ER didn't pay £334.00 (£360-£26) to Hmrc but deducted £360 approx. from £2000 wages


I can prove this to Hmrc by showing them my bank statement. Will that justify?


Many thanks