Breaking £100k - New Tax Code

[SSG1000]

So I accidentally didn’t move enough of my salary over into my SIPP and my taxable income for last year came to £104k…. I’ve received a letter from HMRC stating I owe £1k in tax, but they will adjust my tax code to recoup the adjustment.

Never experienced this before, but wanted to check if it’s advised to either repay the tax in a lump sum or let them adjust the tax code?

Thanks!

[PM3]

With such a small amount of tax I would juts leave them to it. If you pay it back , they being idiots, might just adjust anyway and over tax you . They did this to me for a larger amount a few years ago , then it was like tax code ping pong.
You would not see expedient action if they were owning you .

[Funk]

Part of me would want it paid off now and the tax code back to 1257L but on the other hand what you effectively have here is an interest-free £1k loan paid back monthly - stick an extra £1k in a high-interest account or ISA and pocket the interest, let HMRC recoup it from you at c.£80/mo... That is unless the change in tax code could impact on any other benefits such as childcare/healthcare/company vehicle etc?

[SSG1000]

Thanks both - glad I’m not the only one thinking to leave it be and let bank interest do its thing.

The craziness of the tax system eh!

[SSG1000]

Thanks both - glad I’m not the only one thinking to leave it be and let bank interest do its thing.

The craziness of the tax system eh!