Martin Lewis urges Britons to check their tax code as HMRC gets millions wrong – act now

Martin Lewis gives advice on checking your tax code

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Martin Lewis, Money Saving Expert, is well known for providing financial tips and tricks to Britons as well as the latest warnings about money. Today, Martin focused on tax codes, used by millions of working people right across the country. A tax code is used by a person’s employer or pension provider to work out how much Income Tax to take out of pay or a pension.

As the Government explains, HM Revenue and Customs tells the organisation concerned which code should be used.

This will help Britons to pay the correct amount of tax according to their circumstances.

However, Martin highlighted millions of tax codes could be incorrect, which mean individuals could potentially be suffering financially as a result.

Writing in his weekly newsletter, the expert said: “It’s your responsibility to check if it’s wrong.

“If it is (millions are), it can mean you’re overpaying, and are due money back.”

However, it is worth noting there is a time limit worth considering when it comes to tax code checks.

Martin went on to explain that Britons can cast their minds back to previous tax years and check if their code was correct.

But if individuals wish to benefit from a potential adjustment and payment for the 2016/17 year, they have just over a week to act.

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Martin has informed readers that the deadline for a claim for that specific tax year falls on April 5 – when the current tax year draws to a close. 

Tax codes usually start with a number and end with a letter, so this will be key to look out for.

The numbers in a tax code illustrate how much tax-free income a person receives in a certain tax year.

Letters, however, refer to an individual’s situation and how this impacts Personal Allowance. 

One of the most common tax codes for this tax year, for instance, is 1250L, which should be the case for most people who have one job or pension.

Britons will be able to check their Income Tax online, which will provide them with key information.

This includes what their tax code is, if it has changed, how the tax code is worked out, and as a result how much tax a person is likely to pay.

Usually, if a person pays too much or too little tax over the tax year, HMRC will inform them of this.

People can expect to receive what is known as a P800 form, or a Simple Assessment tax calculation.

This will tell an individual how to get a refund or pay the tax they owe. 

Taxpayers are always encouraged to inform HMRC about any changes to their circumstances which could affect their tax code.

Individuals who believe their tax code could be incorrect can use the online service to update their details.

For those who cannot use the online service, HMRC can also be contacted through web chat, phone or post.

Martin Lewis is the Founder and Chair of MoneySavingExpert.com. To join the 13 million people who get his free Money Tips weekly email, go to www.moneysavingexpert.com/latesttip

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