Payslip/BankStatement on FTE mismatch to HMRC records - ILR

[viratk10]

Hello Gurus, Senior Members and everyone else, I would really appreciate your time and comments on my case-

What consequence can I expect on my ILR application based on below situation. Do I need to rectify anything before anything or am I fine in current situation?

I will be completing my 5 years of residence in UK in May under Tier1 (General) visa and now eligible for ILR application(within 28 days of 5 years completion). As I was preparing for my documentation, I noticed that my first employer in UK have not submitted my correct earnings to HMRC. I used these earnings (£18000 gross) during my Tier-1 Extension application in September 2011 and submitted legitimate evidences to HO. However as per HMRC record, the earnings shown are around £7200.

I was taken on a full time employment(FTE) by this company back in May 2011. During this employment, they signed a contract with an agent for 3 months based for me to work at a client site (sort of worked in Umbrella company/body shopping model). So all my earnings are legitimate via that contract. I was given Payslips showing monthly payments(based on my package) and same amount(net) was transferred to my bank account. So I have all evidences which are correct, however it seems the employer did not submitted the correct figure to HMRC when I left them(that saved tax and NI for them).

At present I am a contractor via own limited company and have done all 3 previous self-assessments without any discrepancies. My last year self assessment is due in Jan 2017, but I have P60 and interim company accounts for ILR purposes to show to HO.

Can you please comment/advise on things I need to bothered for while applying ILR to HO?

[geriatrix]

Is the employer in question still around?

If so, get them to pay the tax / rectify the errors. Get the HMRC to update their records. Apply for ILR after you have confirmation from HMRC that the records have been amended.

But do you have extant leave that will last more than the time it may take for you to cover all the steps above?

If not,
Likely to be refused. Similar refusals have been posted on the forum.
Because you will be applying under the PBS route, you will not be given the right of appeal but only right to administrative review - which will again fail for the same reason.

If refused, the only possible way to overcome the issue may be through courts / JR, but for that you will need extant leave to remain in the UK.


If I may ask, is the sum of all such net payments in question same (or similar) as shown in HMRC records (around 7200 as you state).

[Wanderer]

For the record, I think FTE is Fixed Term Employment, sort of zero hours contract for professionals, halfway between contracting and emplyment, where you get the worst of both worlds.

Doesn't denigrate the fact that the consultancy is legally bound to pay the tax due, and hasn't, leaving the OP in a precarious position.

I though HMRC RTI was supposed to end all this? I operate PAYE through RTI, not sure when it started though.

[RRSB2012]

RTI was implemented in April 2013 ....... members are facing issues dating back to 2011

This is the second case I am reading today, There is another thread with similar issue by Mohsin. Seems like a growing problem.

[Wanderer]

RTI was implemented in April 2013 ....... members are facing issues dating back to 2011

This is the second case I am reading today, There is another thread with similar issue by Mohsin. Seems like a growing problem.

Cheers, I couldn't remember!

There's a couple of others too. Not sure where the law stands on this, surely can't be the employees fault, but the tax is owed by the individual, the employee is just passing it on to HMRC, I don't like to think about it....

[viratk10]

Is the employer in question still around?

If so, get them to pay the tax / rectify the errors. Get the HMRC to update their records. Apply for ILR after you have confirmation from HMRC that the records have been amended.

Yes the employer is still active. I had a chat, employer have assured me verbally a week back that he will look into this matter, however no actions taken yet. I feel concerned as he might be just dragging this. If I inform HMRC and get an acknowledgement of tax discrepancy, would that suffice me to proceed with ILR application or would there still be issues with HO on this matter?

But do you have extant leave that will last more than the time it may take for you to cover all the steps above?

My current Tier1(G) extension leave expires on in 5 months. If the employer does not pay taxes, what would be my options as long as HMRC acknowledges? Any ideas on how long it takes for HMRC to acknowledge this discrepancy in written?

If I may ask, is the sum of all such net payments in question same (or similar) as shown in HMRC records (around 7200 as you state).

HMRC records matches to P45 issued by employer with incorrect gross earning of £7200. However I have shown evidence in the form of payslips and bank statements(both are legitimate) to HO, claiming £18000 which does not match HMRC records. Isn't that an issue?

[viratk10]

For the record, I think FTE is Fixed Term Employment, sort of zero hours contract for professionals, halfway between contracting and emplyment, where you get the worst of both worlds.

Doesn't denigrate the fact that the consultancy is legally bound to pay the tax due, and hasn't, leaving the OP in a precarious position.

Sorry FTE means full time employment here, where I was given Offer/Contract letter during joining. I was given salary based on my Annual Salary with proper payslips and was credited the net salary(after taxes deducted at source) in my bank that matches payslips.

I though HMRC RTI was supposed to end all this? I operate PAYE through RTI, not sure when it started though.

I am not full aware but I guess there was no mandatory RTI obligations of employers during year 2011-12.

[RRSB2012]

Virat,

Till I know through reading about Taxes, HMRC wont be able to help you based on Pay Slips and Bank Statements. They want Tax money and will keep showing your income as £7200 until they get tax on additional £10,800. Since HMRC wont change their records, UKVI might hesitate in granting ILR.

It is good that you verbally spoke to your employer. However I think it is time to communicate with them in writing (think about communicating via a lawyer). Realistically what are the chances that they will pay the tax on additional £10,800 ..... Don't want to come across pessimist but I don't think so that will happen.

Solution: If employer doesn't pay the tax, Evaluate the cost of going to Court against the employer Vs. the cost of Paying the Tax yourself which would be around £2000 (ball park).

I know it is very unfair but seems like the only solution to me. Seniors might advise more on this or may advise a better solution.

Hope this helps
R

[viratk10]

Solution: If employer doesn't pay the tax, Evaluate the cost of going to Court against the employer Vs. the cost of Paying the Tax yourself which would be around £2000 (ball park).

I know it is very unfair but seems like the only solution to me. Seniors might advise more on this or may advise a better solution.

Hope this helps
R

Thanks RRSB2012 for your suggestion. My employer update me yesterday that they have updated HMRC return online based on my payslips (£18000). Also they have provided me updated P45 for my records. Does that mean they have paid the taxes too, or do I still need to worry about them paying taxes for my earnings?

Also when I contacted HMRC PAYE for employees, they still can't see the updated figures for year 2012/12.

HMRC have advised me to post payslips and updated P45 to them so that they can investigate and resolve the matter but it might take end of June(worst case as mentioned by the person over phone). Any further steps I need to do before I apply for ILR?

[RRSB2012]

Virat,

P45 is a good piece of evidence. I believe HMRC will only update their records re payment of taxes once they have received the payment.


May be someone with similar experience can add more for you.
Thanks
R

[geriatrix]

Any further steps I need to do before I apply for ILR?

Confirmation of tax payment / updated tax record - that you could show to HO.

[viratk10]

Any further steps I need to do before I apply for ILR?

Confirmation of tax payment / updated tax record - that you could show to HO.

Thanks for your advice.
Its been over a week, i sent letters(updated 45 and payslips) to HMRC via RoyalMail signed-for next day delivery. If I track the post is not yet signed(says its on way). Called HMRC atleast 3 times during the week but all they say is they cant confirm if they received the document or not, also they ask me to check with Employer if they can chase HMRC employer helpline to get this updated. This is beyond my control.

Is there a way to expedite HMRC tax updation process based on anyone's experience?

One of the solicitor says that there are 95% of chance I will get approval as this is an Employer error not SA issue, and thats why its ok if I go to HO for ILR even if there amendments still in process. If they ask for descrepancy, I can always show P45 as a proof of amendment that my employer have already done. Anything more is beyond my control/responsibility as only Employer can sort out outstanding tax with HMRC, so HO should understand this.

Any thoughts?

[geriatrix]

For HMRC queries, timelines and pracedures, google a HMRC / tax forum.

Applicants have been refused for the same reason as yours. It is your risk and your choice.

[viratk10]

For HMRC queries, timelines and pracedures, google a HMRC / tax forum.

Applicants have been refused for the same reason as yours. It is you risk and your choice.

My Employer has agreed to provide me HMRC receipt of sucessful submission alongwith a letter confirming that that I am no where related or responsible for the mentioned tax discrepany.

Won't this suffice as supporting documents confirming tax amendments ?

Its neither in my hands nor my responsibility to pay the amended tax as Employer suggests that they cannot pay the updated tax unless HMRC send them the updated calculation figures. I checked with HMRC and they advised me to talk to Employer for the payment and followup of amending HMRC records for underpaid tax.

[geriatrix]

My Employer has agreed to provide me HMRC receipt of sucessful submission alongwith a letter confirming that that I am no where related or responsible for the mentioned tax discrepany.

Won't this suffice as supporting documents confirming tax amendments ?

Should help, no doubt. But no one here can tell you whether a caseworker will make a decision in your favor in light of the supporting evidence from the employer or not.

I believe you have done whatever you, personally, could to show that the tax discrepancy on your record is not something you can be held responsible for. Whether it is good enough for a caseworker, no one say unfortunately.

All you can do is apply with all the evidences you have collected and hope for the best.


All the best.

[viratk10]

Thanks all for your advise and help.

I called HMRC today and they confirmed me that an amendment is made from previous employer and they will issue me the letter confirming latest amendment.

However I discovered that still there is a small difference between Gross salary I see on my last salary slip(£18102) vs updated P45(£18000).

Although this difference is of £102, but can this still be an issue if I go with Amended HMRC document. I guess the tax difference will be £40 but still underpaid by employer.

As I recollect during my first Tier1 extension( Sep 2011), I have shown HomeOffice an Employer letter confirming a gross salary paid as £18000 (for 4 month @ £4500 per month) as per my pay package. But the Salary he ran in payslip is more(£18102). And I am not sure if I have submitted the Salary Slips to Home Office as Income Proof.

Any advise/guidance for next step is really appreciated...

[viratk10]

I would like to update that I have got ILR approved yesterday.

Went to PEO Corydon and it took about three and half hours total to process the application. During the process, Caseworker asked me to provide the Income document for year 2011-12 (where I had issue with Employer did not submit the correct paye and tax records to HMRC in the past), however I produced the HMRC documents confirming the actual(amended) earning from my previous employment.

No further questions asked.

Thanks everyone for your support and advice.

[RRSB2012]

Virat,

Thanks a lot for updating and Many heartiest congrats.

it makes me really happy to see that you got through. You were not at fault and it is encouraging to see that UKVI can see that.

Many congrats
R