A MONEY-SAVING blogger has revealed how a quick and easy tax check saved him hundreds of pounds.
Krish Kara, 23, from London, regularly shares personal finance tips with his nearly 90,000 TikTok followers.
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But some of the advice has proved useful in his own life too.
The digital marketer, who runs the “Krish.kara” TikTok page as a side hustle, saved himself hundreds after a quick check revealed he was on the wrong tax code and was paying too much out of his salary.
Martin Lewis has previously warned workers to check they are on the right one and avoid paying too much tax.
After his discovery, Krish spoke to HMRC, which handles tax collection, and they put him on the right one and offered him a rebate.
Rebates typically take around eight to 12 weeks to hit your bank account.
Once Krish received the money, he stashed it away into his savings.
He said: “I found I was being taxed too much.
“Most of the time your tax code is done automatically, but sometimes HMRC put you on the wrong tax code.
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“I checked with HMRC and found out I was on the wrong tax code and got a rebate.”
Krish only realised he was on the wrong one after speaking to a colleague at work on the same wage as him who was, to his surprise, taking home more money each month.
He said: “I worked out me and my colleague were on the same salary but we had different tax codes.”
Krish, who did the check in late 2021, used the personal experience as inspiration for one of his Tik Tok videos.
And that’s not the only time he’s relayed a real-life experience on to the social media platform.
He’s revealed to his followers how bank switching bonuses and the 1p saving challenge can earn you extra cash too.
The 1p challenge in particular saw him raise around £500.
What is a tax code?
Your tax code is the code used to figure out how much of your pay packet should be deducted and given to HMRC.
It’s made up of several numbers and a letter.
Currently, 1257L is the code used for most people who have one job or pension.
But your code could feature any number of letters that relate to your circumstances.
The numbers tell your employer or pension provider how much tax-free income you get in that tax year.
How do I find my tax code and how can I change it?
You can find your tax code in a number of ways, including:
- on a “Tax Code Notice” letter from HMRC if you’ve received one
- on your payslip (this could be online or in paper form)
- on the HMRC app
- by checking your personal tax account
HMRC should normally update your tax code when your income changes and should receive the information from your employer.
But sometimes they might receive the wrong information and you’ll be given the wrong tax code.
But it’s your duty to check with them if you think it’s wrong.
You can check whether yours is wrong by going to the government’s website.
You can use the tool to update your employment details and tell HMRC about any change in income that might have affected your tax code.
If you have paid too much or too little tax, HMRC will send you either a tax calculation letter, also known as a P800, or a Simple Assessment letter.
If your P800 letter says you’re due a refund, it will tell you how to claim it.
You might be able to request the refund online, but you’ll need your Government Gateway user ID and password.
You can create one if you don’t have one, but you’ll need your National Insurance (NI) number and two of the following to hand:
- a valid UK passport
- a driving licence issued by the DVLA (or DVA in Northern Ireland)
- a payslip from the last three months or a P60 from your employer for the last tax year
- details of your tax credit claim
- details from your Self Assessment tax return (in the last two years)
- information held on your credit record if you have one (such as loans, credit cards or mortgages)
You’ll receive a Simple Assessment letter if you owe income tax that can’t be automatically taken out of your income, you owe HMRC £3,000 or more or you have to pay tax on the state pension.
If you think the calculation on the letter is wrong, you should call or write to HMRC within 60 days.
You can call on 0300 200 3300 or send a letter to Pay As You Earn and Self Assessment, HM Revenue and Customs, BX9 1AS, United Kingdom.
If HMRC agrees your Simple Assessment was wrong, you’ll be sent the correct one.
If they disagree, you’ll get a letter explaining why, how to pay and how to appeal if you still think it’s wrong.
You can appeal, but you have to do it within 30 days of receiving your initial decision letter.
You’ll need to specify which amounts you think are incorrect and what they should be.
Do you have a money problem that needs sorting? Get in touch by emailing [email protected]
