maxb

I don't think your Personal Allowance can ever be reduced due to tax owed in a previous tax year. My guess is your PAYE tax code has been reduced. The misunderstanding probably comes from the fact that for many people, their PAYE tax code is made up of the Personal Allowance only - but in fact, the PAYE tax code is an overall summary of every part of your tax affairs that needs to be taken into account to deduct the right amount of tax from pay. In summary then, the reduction of the Personal Allowance due to earnings over £100k, and the additional earnings deduction to repay tax owed in a previous year, will both operate independently. This means that the combined tax free amount for PAYE (considering both Personal Allowance and tax owed) can go NEGATIVE as total earnings approach £125,140. There is another detail to be aware of, too: the PAYE tax code system by itself does not automatically adapt to Personal Allowance reduction over £100k. In the year a taxpayer receives a pay rise that moves them over £100k, or further towards £125,140, unless HMRC are notified of the increase in the full year's predicted earnings during the year, resulting in a changes tax code, PAYE will under-deduct throughout the year, leaving a balance to be paid at Self Assessment. In subsequent years, HMRC's earnings estimate for that employment will be updated based on the previous year, so it will start to be coded in to your tax code.

My question is not answered there.

I think you should talk to HMRC as soon as possible, so you can ask them what happened, and find out the current status as they see it - and maybe get them to fix things. Webchat is probably the easiest way to get hold of them, and the "Self Assessment: general enquiries" link has been posted in several previous messages in this thread. The chat starts out connected to an automated system, but just tell it "talk to a human" (and queue for one to be available). One thing that stood out in your message... you said your tax code had been altered, but not whether you meant your current one, or one which will apply from 6th April, in 2 weeks. Tax from the 23/24 return, if being collected via tax code, would happen from 6th April 2025 i.e. tax year 25/26. If it the tax code alteration you mentioned was for the current (i.e. 24/25) tax year, it was likely for some other purpose than collecting tax from your 23/24 return. The notice from HMRC telling you about your new tax code should also explain how it has been calculated. If you don't have it on paper, try to see if you can find it online - it's in the same HMRC website where you fill in and submit your return, under the heading "View PAYE coding notices". But in any case, you need to get in touch with HMRC urgently, as if, for any reason, you can't get the penalty removed, right now you're still accruing additional interest on it.

I understand you need the UIR to claim EIS income tax relief after purchasing the shares... But many years later when selling for a gain and claiming EIS disposal relief, that seems to be just a matter of declaring a code OTH other claim or election in the capital gains pages, and providing an explanation in the additional information. If there is specific guidance defining what needs to appear in that additional information, where can this guidance be found? (The SA108 Notes don't mention this relief specifically at all.)

It sounds like you are referring to the "starting rate for savings". That in particular isn't something I've received, but allowances of this type are automatically implemented in the online self assessment calculation and don't require you to do anything to claim them, beyond filling in your income data. There is an option to view your full calculation before submitting a return online, which should let you confirm that it really has been included.

Once the tax year is complete, you can start filling in your self assessment online - using estimates at first if need be - and view your calculation as many times as you like, without submitting the return. This is by far the most complete online "simulation" of the whole tax calculation. If you require a projected sum before the tax year is over, then unfortunately I don't know of a good resource - I've typically fallen back to some elaborate spreadsheets implementing just the bits of the calculation relevant to me.

That sure is a lot of complexity for one forum post :-) I too am a recent EIS subscriber now getting to find out how unclear many of the procedural requirements are. On the matter of NVCs... there's an abundance of information on the internet saying you can make them, but when you look into how, you find out there are substantial evidence requirements attached, which make exercising that rather burdensome. As a result, I've chosen to not make them, and am waiting for my failed investments to be fully wound up, so I can report them as simple disposal. On the matter of administration and the 3 year period... as I understand it, a company entering administration does not immediately make its shareholders cease to be shareholders... that would suggest the 3 year period continues to run, and depending on the length of the adminstration proceedings, may potentially complete, enabling income tax relief to not be withdrawn. On the matter of the loss relief on the 2022 shares... I've never heard of any provision for voluntarily undoing EIS income tax relief. I conjecture this would play out as needing to follow the procedure regarding withdrawal of the EIS income tax relief following a disposal within 3 years, and then claiming loss relief based on (total loss) minus (amount of EIS income tax given and not withdrawn, if any). On the matter of the interaction between NVCs made within the 3 year period, and the withdrawal of income tax relief... this appears to rest on the interaction of wording between several different pieces of legislation, and I personally wouldn't want to assume anything without taking professional advice.

A higher rate tax payer making this correction would recover an additional £500 tax relief for each £10,000 of historic net contribution corrected by grossing up. (Or less, if they they had less income subject to higher rate, than the size of the correction.)

A new question can be posted from https://community.hmrc.gov.uk/customerforums/sa - scroll to the bottom of the page to find the "Create a new thread" form. I don't really understand the question you're asking, though... I'd say gross pay equals taxable pay because all pay is taxable? So I'm not sure what the other figure is? In any case, the tax relief on pension contributions isn't calculated with reference to just a pay figure, but potentially considers all other sources of taxable income in the year too, e.g. savings income. Could you rephrase your question in a different way, potentially illustrating with an example?

As you suspect, dividends are not eligible for this - https://www.gov.uk/hmrc-internal-manuals/pensions-tax-manual/ptm044100#earnings