Paid more tax due to employer error, how to get it back

S

SandraD

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Can anyone help settle an argument about tax? :mad:
The employee is paid fortnightly and the employer has messed up wages several times in the last few months.
For example, in the first fortnight of the month the employee has not been paid for the correct amount of hours worked. These hours have then been added to the second fortnight with the result that the employee is now being taxed in the next tax bracket up and so being charged more tax.
Employee is going crazy and employers are not sorting out the problem
Can the employee claim back the tax paid in error and if so, is it up to the employer or Revenue to issue the refund?
 
If you have overpaid tax and your tax cert has been issued on a cumulative basis, then you may get a refund of tax in your next pay run.
 
The employer can give the refund himself if it's done before the end of the tax year.

In fact, they can probably give the refund, if they do it before submitting the year end return to the Revenue.

If they have submitted the year end return, the employer won't be able to do it (or not very easily anyway) and the employee will have to deal with Revenue.


Brendan
 
SandraD said:
in the first fortnight of the month the employee has not been paid for the correct amount of hours worked. These hours have then been added to the second fortnight with the result that the employee is now being taxed in the next tax bracket up and so being charged more tax.
Click to expand...

If the employer is using a normal wages accounting system, what you describe would not result in too much tax.

The PAYE system is very clever and works on a cumulative basis. If an error is made, it is self-corrected at the next payment, as long as that is within the tax year.

In the case you describe, the employee would have paid too little tax in the first fortnight, and then too much in the next fortnight.

If the error was made in the last payment of 2014, and the back pay was paid in 2015, it could result in a problem. But it's likely to iron itself out.

The only time it would not iron itself out would be if the employee was on the 20% tax bracket in 2014 and will be on 41% by the end of 2015.

Brendan
 
If the actual gross amounts have been correctly paid, but the issue is being paid too much in one period so as to hit the upper PAYE limit then at the end of the year you apply online at the Revenue for a P21 balancing statement that will repay any overpaid PAYE tax.
 
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