Apr 29 2009
Reporting changes that might affect your tax
A change to your income or circumstances may affect how much Income Tax you have to pay. It’s important to let your Tax Office know about any changes right away so that they can work out whether you need to pay extra or less tax. By contacting your Tax Office early you can avoid paying too much tax or owing tax at the end of the year.
Changes you must tell the Tax Office about
You’ll need to tell your Tax Office if you:
You’ll also have to let your Tax Office know if other income that you get - like savings or rental income - increases or reduces.
All these things and more can affect the amount of Income Tax that you have to pay.
Marriage or civil partnership where one partner was born before 6 April 1935
Tell your Tax Office if you get married or form a civil partnership and at least one partner was born before 6 April 1935 - you may be eligible for the Married Couple’s Allowance (MCA) if you pay tax.
If you get divorced or your civil partnership dissolves or you separate and you were getting the MCA you will no longer be eligible so you need to let your Tax Office know.
Death of a spouse or civil partner
If your husband, wife or civil partner dies you need to contact your Tax Office if either of the following applies:
Starting/stopping self-employment
You must tell HM Revenue & Customs (HMRC) that you’re self-employed within three months of starting or they may charge a £100 penalty.
If you stop being self-employed let your Tax Office know as soon as possible.
Starting/stopping to receive company benefits
If you start to get taxable company benefits you should tell your Tax Office right away so that you don’t get a large tax bill at the end of the year. Employers don’t have to tell HMRC about any company benefits you get until the end of the tax year, unless it’s a company car.
Your Tax Office will adjust your code number and start collecting all or some of the extra tax sooner.
You should also tell your Tax Office if you stop getting taxable company benefits. They can change your tax code and make sure you don’t pay too much tax.
Starting to receive the State Pension
When you reach State Pension age you don’t automatically stop paying Income Tax but your tax bill may go down. You need to tell your Tax Office - in advance if possible - when you retire so you don’t pay too much tax.
The Tax Office will want to know:
Starting/stopping state benefits
If you start or stop getting state benefits it may affect your tax bill. The sooner you get in touch with your Tax Office, the sooner they can adjust your tax code to make sure you always pay what’s due.
How to report changes to your income
If you’re on Paye As You Earn (PAYE) but don’t normally complete a Self Assessment tax return
Let your Tax Office know about changes to income - even if you’ve received the income outside your job or pension and it’s not dealt with through PAYE , for example rental income.
HMRC may be able to change your tax code so that you pay the right amount of tax. If they do this you’ll get a PAYE Coding Notice explaining the changes to your code.
In some cases they may ask you to complete a tax return and pay any extra tax through Self Assessment.
If your taxable income has gone down you may be due a refund.
If you don’t normally complete a tax return and you’re not on PAYE
If an increase in income takes your taxable income above your Personal Allowance and any Blind Person’s Allowance you’re entitled to you must contact your Tax Office.
You may need to complete a tax return and pay any tax you owe through Self Assessment.
If you already complete a tax return
If you have or expect a significant decrease in income you can let your Tax Office know right away - they may be able to adjust your ‘payments on account’ to reflect the revised amount.
If you change address
If you change address it’s important to let your Tax Office know - even if you pay some or all of your tax through PAYE and have already told your employer or pension provider.
Under the Data Protection Act they can’t pass on your new address to HMRC.
Changes you can tell the Tax Office about online
If you’ve changed your name or address or would like the Tax Office to contact you at a different address, you can let them know by completing and emailing an online form to them.
