Income Tax is a tax you pay on your income, you do not have to pay income tax on all sources of income however, and most people in the UK get a Personal Allowance of tax-free income.
Income Tax is a tax you pay on your income. This includes money you earn from employment, profits you make if you’re self-employed, some state benefits, most pensions, job benefits and income from a trust.
Most people in the UK get a Personal Allowance of tax-free income. This is the amount of income you can have before you pay tax.
What if the amount I am being asked for income tax is wrong?
There are a number of reasons why your income tax could be incorrect, such as:
You are no longer self-employed but did not inform HMRC
You made an error on your tax return form
You missed the tax return submission deadline and HMRC estimated your income, which will likely result in discrepancies
There is a time lag between payments and account updates
HMRC may have made a mistake
When there are anomalies in your income tax payments, you can easily find yourself in arrears (you may not even have known your income tax payments were incorrect). First things first, it is very important that you get in touch with the Income Tax Helpline on 0843 504 7177 or 0300 200 3300 to discuss your options.
HMRC have the authority to take action such as repossessing your valuable assets for sale at auction, court action and even taking money directly from your account – so it is important that you agree an arrangement to rectify any discrepancies and pay arrears as soon as you realise something may not be right.