New online options for employees and pensioners from HMRC

Philip McNeil By Philip McNeill, ICAS

10 August 2016

Philip McNeill, Head of Taxation (Tax Practice and Small Business), outlines HMRC’s new online processes for Personal Tax Accounts.  

Every year HMRC reconciles employer returns and sends out notices to PAYE taxpayers who have over or under paid (the P800 form).

This year is going to be different. As part of the move to digital, PAYE taxpayers will increasingly be directed to set up and use a Personal Tax Account to check their tax position, find out the reasons for under and over payment, and get refunds.

What is a Personal Tax Account?

The Personal Tax Account was launched in August 2015. It is part of HMRC digital strategy to bring all an individual’s dealings with HMRC into one place.

Tax codes and year-end reconciliations can be viewed, and in due course, for some taxpayers, this may avoid the need to submit an annual self-assessment tax return.

HMRC has made a short video and there is information on its digital blog.

What’s new?

From 1 August employees can use the Personal Tax Account to check their 2015-16 PAYE tax position. If a refund is due, bank details can be entered online. The refund should be processed within three to five days.

For repayments HMRC’s default option this year is to send a payable order 45 days after the issue of the reconciliation notice (P800 form). So failing to enter bank details online, or contact HMRC to request a payable order, is likely to delay the refund.

Employees with a tax agent who is authorised to receive refunds on your behalf, will not be able to use the new refund option.

A new online payment service for PAYE underpayments should be available later in the year.

How to access the digital tax account

You can log in to your digital tax account from the website.

Note that using the green ‘start now’ button will log you using HMRC’s security checks. For most people this should be a simpler process than using GOV.UK Verify option which is offered under the heading ‘Before you start’.

Please let us have your views

If you have a Personal Tax Account, please share your experience.

Is the information shown in your Personal Tax Account helpful and accurate? If you have more than one source of income, were these easy to identify? Have you found the Personal Tax Account useful and an improvement in HMRC service?

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