subject: The Abcs Of The Emergency Tax In The Uk [print this page] To someone who has a little understanding of the UK tax system, Emergency Tax might seem like a tax that is imposed on taxpayers during times of wars or economic crisis. This is definitely not the case, and emergency tax has nothing to do with a state of emergency. This type of tax comes about as a result of an emergency tax code which comes about when employer does not know all about your income status, and the HM Revenue and Customs is yet to provide you with a tax code.
Every year, the HM Revenue and Customs come up with a different code, and the code for 2011/2012 financial year is none other than 747L. This means that you will be allowed a basic allowance of 7,475 pounds after which you will be taxed on any amounts more than this. Under this banner, you will not be allowed other allowances such as disability credits, or family credits, simply because the commission is yet to work your tax situation. However, once they have established your exact condition, you will then be given the code that best suits you, depending on your unique circumstances.
To know whether the emergency tax code applies to you, you need to know the other circumstances under which the emergency tax code might apply to you. These other reasons may include the following:
You may be a new employee from another organization into another one, yet you have not provided your new employer with the form P45. This is a form that comes from your previous employer, and explains your previous tax payments during the part of the financial year that you were still working for the previous employer.
The other reason could be that you are on your first job ever, but before that, you were self-employed. This puts you in the same position as someone who has never been employed before and never received any form of taxable income.
Lastly, you can also be placed under the emergency tax code if for one reason or another, your tax code has changed as a result of changes in your taxable benefits, and the HMRC are yet to clearly define your status.
As you continue to look into the emergency tax code, it is indeed advisable that you learn as much as possible about this part of the UK tax system, since this is one of the largest sources of errors and misunderstandings when it comes to calculating the taxable amount.
