Shortfall in National Insurance contributions...

Discussion in 'CycleChat Cafe' started by Maz, 29 Jan 2008.

  1. Maz

    Maz Legendary Member

    Not the most glamourous of subjects, but...

    Yesterday, out of the blue, I got a letter from HMRC telling me that according to their records (err..I thought they'd lost them all), for the whole of the financial year 2005-06 (yes, nearly 3 years ago) I didn't pay any NI contributions and that I now owe them £XXX.xx.

    I'm not self-employed and my NI contributions come straight out of my salary. I now need to provide proof of my payments and they've given me a form to fill in.

    Has anyone else ever had one of these letters? Are they just trying to fill in the blanks for all the data they lost a few months back? Why hassle me and not my employer?

    Guess I'll have to dig out the P60 for that year. :smile:
  2. sheddy

    sheddy Guru

    Bit of a bummer. Not sure why they are chasing you now though.
    I thought one only needed to make NI contributions for 30yrs and so that if there was a shortfall they would be asking to make up the shortfall towards the end of your working career.
  3. fossyant

    fossyant Ride It Like You Stole It!

    South Manchester
    First call...get onto your employer.. that's it... We're you employed in this time..

    Give us some idea's mate - I'm a boring accountant !! ARGH ! FOR MY SINS

    Were you employed during this time and did you get the necessary P whatsits.... P46 etc.
  4. yenrod

    yenrod Guest

    Ive had this too - wanting info of when i was temping and then signing when not working...

    Why do they do this aren't the records at the pensions good enough !
  5. OP

    Maz Legendary Member

    I've been working full-time with my current employer since 2001. No breaks in employment during that time, just the normal holiday entitlement, of course.

    Bit of clarification needed...the letter says I have until 2012 to pay up. If not, the year 2005/06 will not count towards my pension.
  6. marinyork

    marinyork Resting in suspended Animation

    Had several letters over the years. The basic answer is no one really knows how accurate the NI stuff is. Going on some other peoples' info, not all that accurate. Hope if you dig out pay into it'll get sorted easily.
  7. Van Nick

    Van Nick New Member

    It's best to show the letter to your employer in that case and hopefully you won't have anything to pay.
  8. goo_mason

    goo_mason Champion barbed-wire hurdler

    Leith, Edinburgh
    We were warned about this by work. The HMRC is behind in its processing and many staff were receiving these letters (even though work submitted details on time last year). The HMRC told our HR department that we were to ignore them.

    Speak to your HR people and ask them to get onto HMRC to confirm that the same applies in your case.
  9. Fab Foodie

    Fab Foodie hanging-on in quiet desperation ...

    Hi Maz.
    Curiously I have had exactly the same, and for the same period.
    I was effectively self-employed during that time and paid my tax on account quarterly. Calculations and tax-returns were prepared by a big accountantcy firm. I've sent the ino to them. I'm glad you've posted, thought mine was a anomalie of the way I paid tax then. Maybe it's something more quirky though. I don't have a p60 as such so the accountancy firm (which has been merged twice and none of the original people are about) should have the records.
    Bummer. Just had to pay a "Tax Underpay" which would have bought a very nice new Fixie plus a Folder :ohmy:
  10. Fab Foodie

    Fab Foodie hanging-on in quiet desperation ...

    Mine states the same. It's bloody worrying, I keep getting contacted by different "Districts" of the HRMC, one part never knows what the other is doing. It's a right Royal mess.
  11. OP

    Maz Legendary Member

    Well, I'll take goo's advice and speak to HR dept tomorrow and see what they have to say about it before filling in the form.

    I'm glad I asked the question. Sorry to hear you seem to be in the same boat, Fab Foodie.
  12. Dave5N

    Dave5N Über Member

    I had a few, ignored them (I'm dead good with managing my financial affairs, me), and a while later they wrote to me telling me I didn't need to pay anything. The IR are as bad, taking years and years to change my PAYE code, then insisting I owe them money and wanting immediate payment.
  13. goo_mason

    goo_mason Champion barbed-wire hurdler

    Leith, Edinburgh
    Here's the official line from work:

    "... we have been informed that HMRC (Her Majesty's Revenue and Customs) are still behind with the processing of the 2005-2006 end of year National Insurance return.

    Because of this backlog, HMRC systems are still automatically generating letters, advising some employees that there is a shortfall in their National Insurance Contributions. This is incorrect.

    A number of our people have received a letter in the last week or so, and having spoken to HMRC, it appears more letters may be distributed over the coming weeks.

    Unfortunately, HMRC cannot stop these letters being generated and are unable to confirm who they have issued a letter to.

    If you have received a letter, or do so in the next few weeks, claiming you have a shortfall for 2005-2006, please ignore it. Your National Insurance contributions have been made and payments are up to date.

    Once HRMC have finished processing the 2005-2006 payments, you will receive another letter confirming that there was an error and there is no shortfall in your NI contributions for 2005-2006.

    We cannot confirm when you will receive this letter from HMRC, as it is dependent upon how quickly they deal with the backlog, but we have confirmation that they will be sent as soon as possible. "

    I presume that many others will be in the same situation as Maz and Fab Foodie et al. Pity that HMRC did not manage to get the info out there in the public domain that they were incorrectly sending letters, therefore saving some people a lot of unnecessary stress and worry.
  14. OP

    Maz Legendary Member

    Cheers, goo...I got a similar email today, repeated verbatim below. Basically, I need to ignore the letter from HMRC as they messed up. I spoke to HR and they said I was about the 25th person to see them about exactly the same problem:

    Dear all,

    A number of people have informed me that they have received a letter from the Inland Revenue (IR) advising them that they have underpaid on their National Insurance Contributions (NIC's) for the tax year 2005/2006.

    Our payroll provider has checked individual's NI numbers and P60 and P14 information which are submitted to the IR. In both cases all data submitted has been corrrect and we have received a successful sunbmission receipt from the IR for tax years 2005/2006 and 2006/2007.

    The problem appears to lie with the IR's computing system in determining the correct level of NIC's and that they have sent a number of these deficiency letters out in error.

    We have now received a note from the IR stating that they have incorrectly advised some Employees that they have underpaid on their PAYE/NIC payments for 2005-2006 and that they are sorry for any inconvenience caused.

    They recommend that if they have sent you an underpayment and/or surcharge notice recently, and you think the amount that they are asking for is wrong, then you should contact the office shown on your letter.

    As a matter of course I would also advise that you check your NI number against the number printed on the letter.

    Hoping this is of some help,

    Best Regards,
  15. Fab Foodie

    Fab Foodie hanging-on in quiet desperation ...

    Thanks Goo and Maz...makes you weep really....
    I think I'll still keep on my case because of the different way I was taxed...however...the Accountants employed at great expense (not to me thank God), should have got this right....

    On a positive note...this forum is full of most excellent and helpful people!
    Thanks FF->.
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