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Hi
I've just had my annual review. Unfortunately I was away so couldn't check the figures.
I have since had my second letter so passed the review period.
The CSA calculated my payments based on a salary that was 4k less than I earned.
I have checked on HMRC today and my salary for last year was 4k higher.
This means I am paying around 40 quid less than I should be from next month.
The issue is that my salary this year has increased, by about 20%. I don't need to tell them this.
However, when I calculate based on the salary they seem to have, as its 4k less that i earned, the gap (or increase) is an additional 4k and therefore my salary increase looks like it is over 25% (even though it isn't)
Will they look at this at the next annual review and will I have to pay back pay?
Will they re-calculate based on my actual earning from last year (i.e go back to HMRC to check if I say they have got it wrong?) if i phone them and tell them?
Thanks in advance
Perhaps out Finance Moderator could advise on this, here's a link
https://www.dad.info/forum/finance/50253-ask-your-finance-questions-here
I had this the other year, and there is part of this that is a gamble. With me, my annual reviews are based on earnings a year behind what they should be, for example my review about a month ago was based on my earnings from tax year 2016/17 even though the latest figure on my HMRC site were from 2017/18. BUT, next year I cannot guarantee what earning the CMS will base my annual review on, so to be safe I will keep this years earnings within 25% of the 2016/17 tax year, that way if they do use this years (2018/19) instead of the next logical year on record (2017/18) then I will not fall foul of any rules. I reckon if they found you were outside of the 25% then it would backdated and you would owe backdated payments.
But this is a gamble of course.
If I were you I would control this years wages to be within 25% of your current assesment amount, do this through pension contributions, you can then manage these as required to always be within 25% of your current assessment.
Give me a DM if needed.
I would be inclined to agree - I think you are liable to tell them that it's incorrect, and as above, if you make sure your gross is less than 25% over the amount they assessed you on (by putting anything over this into pension - in fact, I would be inclined to get that down to 20% over, just to make sure it doesn't look like you are doing this just to scrape below the threshold), then you may get away with it, any by telling them, they can't come back on you for failing to inform them.
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