Employee with 2 jobs PAYE

[AndyAudi]

Old man had a young lad start with him earlier in tax year doing odd bits, 16years old.

All set up properly with HMRC’s payroll software fairly minimal payments no tax etc.

He went to work elsewhere for a few months & we never stopped his employment or issued a p45 as we expected him to be doing odd bits for us & coming back to us full time before the year was out. (Although he didn’t work for us whilst employed elsewhere he did come back in Dec & now full time.

He produced a p45 from other employer but dad disregarded as he wasn’t a new employee, & already on our system. to date the lad hasn’t crossed a tax paying threshold but will next month. I did try & call the Employer helpline to see if we could do something so he doesn’t get a surprise bill in the future but eventually gave up.

Both employers systems have used full tax code, he’ll finish up for the year with about £14k income between both jobs but potentially no tax deducted from either. What will happen & when, will the RTI info join the dots & get him an adjusted tax code or will he get a bill to pay?

[Rufus Stone]

HMRC will pick it up and likely adjust his 2023-24 tax code to collect the tax owed for 2022-23.

[Sy1441]

Rufus Stone said:

HMRC will pick it up and likely adjust his 2023-24 tax code to collect the tax owed for 2022-23.

Yep this.

[MustangGT]

Depends on amount, they may demand an immediate payment (unlikely though in this case)

What should have happened is that the company/organisation employing him first is his main employer until issuing a P45. The second job should be declared as a second job (the question is normally 'do you have/have you had another job'). The second job employer will then be issued a notice of coding taking into account the first job.

Eg.

Normal tax code = 1257 (£12,570 personal allowance)

First job earns, say, £10k (pro rata) so let's say £5k in first 6 months.

Second job taken in month 7, salary to be £12k

£6k (12k/2) + £10k = £16k = more than £12570

Second job should get a code of 257.

Any over/under tax situation will be sorted at year end.

Alternatively the second job will get a 0 code, or, is put onto a Month1/week1 basis.

[AndyAudi]

Thanks folks,

Yeah I understood the “normal” course of action.
The error has been the guy not saying he’d a 1st job.

(However that would’ve maybe seen him paying tax he didn’t need to & reclaim)

I had hoped HMRC systems would join the dots & we’d get a notice to adjust his tax code before March pay, ( it’s a 5week month so I thought he’d manage to stand the hit)

I’ll put a wee note with his payslip to say they’ll likely catch up with him at sone point

I guess we just ignore the P45 he gave my old man.

[MustangGT]

You could end up with problems form HMRC in that you did not issue a P45 as required when he left, I understand your reasons, but they may see it differently. You need to take a advice from a payroll legal person about the P45 issued by the other employer.

[GR86]

MustangGT said:

You could end up with problems form HMRC in that you did not issue a P45 as required when he left, I understand your reasons, but they may see it differently. You need to take a advice from a payroll legal person about the P45 issued by the other employer.

He didn't leave the OP's company.

I think he was right to ignore the P45, as said he wasn't a new employee.

Unless he wants this all to be taken from March I would probably leave it until the HMRC send him a notice of his new tax code for April. Then call them to explain and ensure they don't think he has two jobs going forward.

[Countdown]

MustangGT said:

You could end up with problems form HMRC in that you did not issue a P45 as required when he left, I understand your reasons, but they may see it differently. You need to take a advice from a payroll legal person about the P45 issued by the other employer.

The "other" company is at fault for giving him the full tax allowance rather than putting him on BR or on a W1/m1 basis. Or he ticked the wrong box on the New Starter Form that the "other" company asked him to complete.

[AndyAudi]

Countdown said:

MustangGT said:

You could end up with problems form HMRC in that you did not issue a P45 as required when he left, I understand your reasons, but they may see it differently. You need to take a advice from a payroll legal person about the P45 issued by the other employer.

The "other" company is at fault for giving him the full tax allowance rather than putting him on BR or on a W1/m1 basis. Or he ticked the wrong box on the New Starter Form that the "other" company asked him to complete.

Cheers folks, funnily enough just spoke to someone at HMRC about this today, as was on about something else. Yep they confirmed personal tax check will be run at end of year & employee will be issued with a revised tax code (if THEY had got in touch they could’ve requested a revised tax code but unlikely to be issued in time now).

I had wrongly assumed the HMRC personal tax checks were “live” & tax codes issued on that basis.

As this lad was a sort of short term apprentice he was not actually earning at a level that would’ve seen him pay tax until he came back to us & his income shot up so not sure what he said to other co/they did.