# A nice little earner for George Osborne



## H1-GBV (Feb 28, 2006)

and I wonder how many over 65s have contributed to it (probably unwillingly)?

I reached State Pension age at the start of February and DWP wrote to say I would get approx £500pm, paid in March & April. This would need to be taxed, as my occupational pension exceeds the personal limit :smile2:.

Yesterday HMRC wrote to give me new Tax Codes for 2015-16 and 2016-17. For 2015-16 they quote my State Pension as £6321 and have reduced my tax-free amount by the same amount. Now that is £5300 more than I will get!

So I rang HMRC and was told "that's the way the system works". They accept DWP's statement that I'm getting a pension and charge a full-year's worth, even though they know I will only get 2 months worth. They will re-assess my income after April and I will get a refund in May/June, as they "need to ensure I pay the correct amount of tax".

When I asked what interest rate they were intending to pay, I was told 0%: you will just get your money back.

So assuming that everyone born after April in every year when they take their pension is "lending" money at this advantageous rate, how much does HMRC gain?

*Has anyone found a way of getting round this?* I was looking to spend my new-found wealth on a trip to sunny Spain, but now I shall have to sit in the UK and shiver, whilst eating bread and dripping, as I can't afford to "lose" £1000. I have already written to my MP but that will not change anything in a hurry (if at all). I am wondering if I can ask for an emergency tax code (1060 rather than 533 which they are offering) and then sorting things out in May/June.

Any suggestions? TIA - Gordon

PS I know gorgeous George doesn't benefit personally :wink2:


----------



## bognormike (May 10, 2005)

call them again and insist that they charge the correct amount that you will receive in state pension, and point out how much your occupational pension is for the year, so they can calculate a "proper" code for March. It's too late to get anything done for February. BUT for March it will only be done on a "month 1 basis", so they will apply it for March only and not cumulatively! So really you're stuffed.....
It's a well known problem!


----------



## Pudsey_Bear (Sep 25, 2008)

Barstewards


----------



## pete4x4 (Dec 20, 2006)

Now thats why my Mum made sure I was born on the 1st April, I knew there was a reason lol


----------



## H1-GBV (Feb 28, 2006)

APOLOGIES TO HMRC :surprise:

Following BognorMike's advice, I rang their helpline again and got a much more amenable person (Sue) who explained that this Tax Code is only operated on a "week 1" basis, so tax is not backdated :grin2:

There is likely to be a slight over-collection of tax (she estimated £8 ) and that will get paid back in May/June. I'm happy to "lend" that much to GO and I'm not even concerned about the amount of interest it could generate 0

I wish the first contact had been so positive and helpful - Gordon

PS I've also had to write to my MP again, retracting some of my vitriolic comments about that wonderful arm of HMG.


----------



## rayc (Jun 3, 2008)

H1-GBV said:


> APOLOGIES TO HMRC :surprise:
> 
> Following BognorMike's advice, I rang their helpline again and got a much more amenable person (Sue) who explained that this Tax Code is only operated on a "week 1" basis, so tax is not backdated :grin2:
> 
> ...


Your experience with the HMRC staff mirrors mine. I had a problem and the first person I spoke to promised action on their part. Nothing happened and I phoned again. This time a helpful lady sorted it in minutes.


----------

