My husband and I went bankrupt last June. I am only on benefits so have been passed to the RTLU for my assets to be sorted and obviously no IPA implemented. My husband however has received a nil tax code which was only implemented in November. My husband was away from September to December so we have only just been able to send his payslips to Moon Beever. He has today received a letter from Moon Beever with NTC payments based on the previous 3 months wage slips. Because he has been away he has obviously made a bit more money. He is now home and not due to go away again for a while so his wages will be lower than that of the previous 3 months, hence the tax being lower. So basically we will have to make higher payments than what the tax should be while hes home IYKWIM.
Tax payments are a little bit different to IPA payments. With an IPA you can take an average of 3 months income and pay that amount. Sometimes this may be lower than what is actually earned and sometimes higher but it would average out.
With tax you should only really be paying what you would have paid as income tax. The NT code will only last until April when the tax year ends so I would ask Moon Beever to redo the payments at the new lower rate. It should mean that:
- More tax is paid for Sep - Dec when your husband was away and earning more - Less tax is paid for Jan - Mar when you husband is at home and earning less
After this the NT Tax code will expire and your husband should receive a new tax code with the income tax payments being taken at source.
If your husband wasn't working away between Jun - Aug 09 then you could forward these pay statements to Moon Beever to show the amount of tax he will be paying for the next 3 months and pay that amount.
Edited by - gettingoutofdebt on 09 January 2010 10:37:59
Thank you gettingoutofdebt for you response. What percentage is tax worked out on, do you know? Everytime I try and work it out it seems to be a diffent percentage every month for me to get anywhere near the actual tax figure.
It is normally 20% but after a certain amount you are taxed at 40%. You can put the amount you earn into a calculator at http://listentotaxman.com/ and it will tell you how much tax you should be paying.
NIL TAX CODE My husband and I went bankrupt
Posted - 09 January 2010 : 10:15:24
