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Where Taxpayers and Advisers Meet

Overpayment and tax and NI

Joined:Thu Aug 29, 2019 8:11 pm
Overpayment and tax and NI

Postby TeeBee » Thu Aug 29, 2019 9:04 pm

I was overpaid in my previous employment and I am still hashing out a payment plan with my ex-employers. I don't have a problem with paying it back but I'm not sure if I trust how they are going about it. I was the one who realised that I was being overpaid not long after handing my notice in and I brought it to their attention. Now I am beginning to wish I hadn't as it is causing me a real headache and as far as I understand it, I will be left out of pocket.

I was basically overpaid £130 for five months amounting to £650 in total. This, of course, is the net amount. The amount I have to pay back is over £1,000 so I am assuming this is the gross amount. I have asked if this is the case but I have not been given an answer. If this is the case, I accept that I have to pay the gross amount back and claim the tax and NI back from the Inland Revenue but I am unsure how to go about this.

The issue I have is that my ex-employers are regarding the over payment as a loan which I am to pay back at £100 a month. As this "loan" will be an arrangement between my ex-employer and myself, I can't see that the Inland Revenue will be aware that I am owed anything back. I have spoken to HMRC and they referred me to ACAS, ACAS have referred me back to HMRC so I am spinning in circles at the moment. Should my ex-employers be communicating with HMRC as regards this? Why do they want to regard it as a "loan"?

I do not understand much about tax at all so I could be missing something so I would appreciate any advice anyone can give. At this point, I have no idea how the figures have been worked out and whether it is actually the gross. I have asked but I'm not really getting any straightforward answers, Instead, I am getting very minimal information that doesn't make any sense to me at all.

Joined:Fri Aug 07, 2015 2:17 pm

Re: Overpayment and tax and NI

Postby SteLacca » Thu Sep 05, 2019 7:33 am

If it was a genuine overpayment of salary which has already been subject to tax & NI (and possibly pension) then they should recover the NET overpayment from you, and the overpayment of tax, NI and pension will be processed via their payroll and recovered that way. It is not your job to recover the deductions as well.

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