emergency tax dilemma

[daredevil096]

hi, my girlfriend recently started new job and is on emergency tax as she has not received p45.She gets paid monthly,first month seemed grand, grosspay:1021.87 ,emer tax credit 147= 57.37 tax (payslip has letter E for tax code).she just rec'd 2nd month,grosspay:1411.15 ,no credit,tax paid=940.17 (payslip has letter N for tax code). Is this figure correct,it seems huge,also what pay bracket does letter N refer to? any help would be greatful

 

[eoinhealy]

To find out that I suggest looking at the revenue website it has all that information on it. Although, I have never heard of tax code N.

 

[Tenacious]

If your girlfriend has not yet received her P45 from her previous employer and wishes to avoid any further emergency tax she should call her local tax office and ask them to allocate some of her tax credits to her new employment. They are her tax credits so she should be able to allocate them (or in part) to whichever employment she wishes.

 

[ClubMan]

Any use?

[broken link removed]

The sooner she gets her P45 and tax situation sorted out the better. Things should balance out via payroll (i.e. she should get any overpayments of tax back automatically) but she should request a P21 balancing statement from Revenue at the end of the year just in case.

 

[Graham_07]

hi, my girlfriend recently started new job and is on emergency tax as she has not received p45.She gets paid monthly,first month seemed grand, grosspay:1021.87 ,emer tax credit 147= 57.37 tax (payslip has letter E for tax code).she just rec'd 2nd month,grosspay:1411.15 ,no credit,tax paid=940.17 (payslip has letter N for tax code). Is this figure correct,it seems huge,also what pay bracket does letter N refer to? any help would be greatful

Ok, what has happened here is the new employer has been issued a cumulative tax card in month 2 after using emergency tax in month 1. The new instruction has Zero tax credits and Zero cut-off point. The code N = normal, its not a tax code just a payroll marker on payroll packages to identify anyone with a normal cert as against an emergency or month 1 cert in other words they have got an instruction from Revenue but it is taxing her at 41% on everything. Calculation as follows :-
Gross pay for 2 months = 1021.87+1411.15=2433.02 x 41% = 997.54 less previous tax paid in month 1 of 57.37 = net tax deducted in month 2 of 940.17. For each month from now she'll be taxed at 41% on all pay.

The reason for this is simply the non-issue of p45 by the previous employer. Revenue believe that she is still employed by them as well and the tax credits are allocated there. Hence the new employer getting a Zero cert. This is quite common if documentation is not done. SHe needs to ring Revenue on their helpline and explain the situation re previous employer. Revenue can sort it out and get a new proper cert issued to her current employer. USe the contact locator on the Revenue site to get the correct phone number to ring. Unfortunately, until the previous employer details are knowd to Revenue, it's likely that a week 1 / month 1 cert will issue and that will hold up the refund to her of excess emergency tax for a bit. Ideally get the P45 to the new emloyer FAST. Incidentally, she should have received a copy of that zero instruciton in the post too and that will have all contact details for Revenue on it.

 

[eoinhealy]

Graham, I think you might have helped me out there a bit too, thanks. I was talking to my girlfriend and looks like her sister is in a simaler situation.

There is a bright side to it all, once you get your P45 and hand it in to the new employer, there will be a nice tax refund.