Paying the Tax Man

[davidk65]

No I don't own Starbucks if I did I assume I would not be bothered by HMRC.
As a pensioner I have a works pension, state pension and two small private pensions that I paid into.
Some years ago the tax man told me I did not need to submit a return and I obeyed his instructions.
I have now received a letter from HMRC telling me I owe them £300 in unpaid tax relating to the tax years 2008/2009. 2009/2010. I rang the tax man on his so called "help line" ( which took a very long time to get through, so long the battery went flat on my phone) asking for an explanation. What I got was not very helpful and I asked for written confirmation of what I had been told. There was another sting in the tail as they indicated it was not £300 but £600 I owed them.
I have not received any confirmation from HMRC but I have written to them contesting liability.
I have spoken to my two private pension providers who confirm they did not deduct tax in the years in question. They say they cannot deduct tax until they are instructed to do so by HMRC. The providers also expressed surprise as they notified HMRC of my pension details before 2002 and did not receive any instructions concerning my pensions until 2010 when they began to deduct tax.
If I am forced to pay, as I think I will be, is it better to pay as much as I can up front or let the tax man collect by adjusting my tax code?

[factor-fiction]

Private pension providers now deduct the tax at source. I recall there was change a few years ago.
If you were receiving gross pension contributions prior to 2010 then HMRC will say it was your responsibility to ensure you were paying any tax due.
When someone gets private pensions as well as a state pension the total income often means some tax is due.

I don't know whether HMRC will allow you to spread the cost through your tax code but I would choose that option if it's available, unless you have enough spare savings to cover it and would prefer to clear the problem quickly

[dzug2]

If you pay through your tax code you will hang onto your cash for longer. AS HMRC don't charge interest if you pay this way you will be better off

[dzug2]

There is a provision that if HMRC have had all your details and failed to act on them then the tax can be waived

I'm not sure of the small print and whether it would apply to you but it's worth checking

http://www.rossmartin...-underpayment-scandal

may help - I've not read the finer detail

[davidk65]

Hi dzug2.
Thanks for that I have had a read and it sounds promising. I am awaiting developments.