Coding out debts
The coding threshold entitles taxpayers to have tax underpayments collected via their tax code, provided they are in employment or in receipt of a UK-based pension. The coding process applies to certain debts such as Self-Assessment liabilities, tax credit overpayments and outstanding Class 2 NIC contributions. Instead of paying off debts in a lump sum, money is collected in equal monthly instalments over the tax year.
The amount of debt that can be coded out ranges from £3,000 to £17,000 based on a graduated scale. This is a different limit to that for paying your Self Assessment bill where the amount owed must be less than £3,000. The maximum coding out allowance only applies to taxpayers with earnings exceeding £90,000.
The full breakdown is as follows:
|Earnings||Coding out limit|
|Less than £30k||£3k|
|£30k to £39,999.99||£5k|
|£40k to £49,999.99||£7k|
|£50k to £59,999.99||£9k|
|£60k to £69,999.99||£11k|
|£70k to £79,999.99||£13k|
|£80k to £89,999.99||£15k|
|£90k or more||£17k|
Taxpayers with underpayments in the tax year 2017-18, have until 30 December 2018 to file their Self-Assessment returns in order to have the monies collected in the 2019-20 tax year starting on 6 April 2019.
Posted by Cassey Nixon on
3rd December 2018
Income excluded from property business
HMRC publishes a list of income streams that are excluded from a UK property businesses’ taxable income. The list includes fishing concerns, hotels and guest houses, tied premises, caravan sites, lodgers and tenants in your own home, extra services to tenants and letting surplus trade accommodation. In most cases the income from these activities will […]
When National Insurance Credits can be claimed
National Insurance credits can help qualifying applicants to fill gaps in their National Insurance record. This can assist taxpayers to build up the amount of qualifying years of National Insurance contributions and thus increase the amount of benefits a person is entitled to receive, for example, the State Pension. National Insurance credits are available in […]