Disputed Employer PAYE Charges: Correct Your HMRC Tax Bill

CREATED BY ROGER EDDOWES Published: 01/09/2025 @ 09:00AM #employer paye charges #PAYE #HMRC #Payroll #TaxCompliance #NationalInsurance

Did you know it's possible to challenge employer PAYE charges, identify payroll mismatches, and correct your HMRC tax bill? My blog post outlines what information to gather and how HMRC will respond to your dispute ...

Employer PAYE charges, Tax burden heavy and steep, Employee's sweat paid

Every so often, a business opens its online account and finds employer PAYE charges that feel out of step with reality, and the first instinct is to wonder what went wrong. The smart move is to pause, look under the bonnet of the payroll, and align what the software says with what HMRC has onrecord.

A calm review always starts with facts, not guesswork!

And that's because a PAYE dispute is nearly always the result of a data mismatch rather than a policy mystery. Verify the payroll year-to-date figures for Income Tax, employer and employee National Insurance, student loan deductions, and any Class 1A entries, ensuring they align with the submissions intended for HMRC.

Before contacting anyone, confirm the basics that anchor the account, including the PAYE reference, the Accounts Office reference, and the business UTR, because accurate identifiers cut through noise. Also note the number of employees, as headcount can reveal a missed starter, an unclosed leaver, or a duplicated record, which can result in an inflated tax bill.

It is helpful to compare what the payroll software reports in Full Payment Submissions with what actually leaves the bank, as a late or duplicated FPS can skew employer PAYE charges. Look for common slip-ups: a pay run posted twice, a correction sent without year-to-date totals, or an adjustment made in software, but never submitted.

When the internal audit does not reconcile, escalate by using HMRC's online help to dispute the figure and request support. If you sign in with Government Gateway, enter the references and provide the software's totals exactly as shown on the screen, as copying numbers from the business tax account can perpetuate the mismatch.

If more than one tax year is affected, file a separate request per
year, as this will make the resolution faster!

Then watch for the acknowledgement email and keep the reference handy. HMRC typically responds by phone or email within a set timeframe to review the FPS details.

A concise, structured explanation always speeds up results, so outline what changed, when it changed, and which pay periods are affected. Include any corrections already sent, the payroll version used, and whether student loans or benefits in kind were updated, because these often drive employer PAYE charges higher than expected.

While waiting for contact, avoid sending speculative duplicate submissions and instead prepare to file any needed adjustments precisely once. Remember that careful dating of revisions, along with precise year-to-date figures, prevents a small PAY dispute from rippling into the next period's calculations.

Of course, the longer game is prevention, so lock in a month-end checklist:

• Reconcile payroll to the bank
• Review variance reports
• Close leavers the day they depart
• Test FPS totals against the software summary before pressing send

Keep an audit trail so any future questions can be answered in minutes, not days.

A dispute is not a drama when handled methodically, and with the correct references, accurate figures, and timely submissions, HMRC can help correct the records and align the tax bill.

By treating payroll as a controlled system rather than a monthly rush, businesses can resolve today's PAYE dispute and stop tomorrow's employer PAYE charges from going awry.

Until next time ...

ROGER EDDOWES
Join our mailing list! Click here and be one of the first to know when we publish a new blog post!

Share the blog love ...

Buffer Facebook Twitter Linkedin Pinterest WhatsApp #employer paye charges #PAYE #HMRC #Payroll #TaxCompliance #NationalInsurance

About Roger Eddowes ...
Roger trained at Edward Thomas Peirson & Sons in Market Harborough before working at Hartwell & Co, followed by Chancery, as a partner. He started Essendon Accounts and Tax with Helen Beaumont in 2014 as a general practitioner with a hands-on approach. Roger loves getting his hands dirty, working with emerging, small-to-medium and family businesses to ensure they receive the best possible accountancy advice. Roger utilises an extensive network of business contacts to leverage the best guidance and practical solutions.

More blog posts for you to enjoy ...
		What the Autumn Budget 2025 means for anyone earning investment income The Autumn Budget 2025 didn't exactly deliver fireworks, unless you count the quiet hiss of millions of savers and small shareholders realising their tax bills are about to get a little heavier. For years, investment income s...
		Get our Autumn Budget 2025 summary The economic backdrop for the Budget is not great. Growth in 2025 has slowed, public borrowing is up, debt-interest costs are high and rising, and there's a massive fiscal blackhole that only seems to be growing. This all mea...
		Companies House fees: what's changing from 1st February 2026? It seems like everyone is putting up their prices, and Companies House is no different. This starts from the 1st of February 2026. The cost of key filings goes up, but I think the added value and protections are worth it ......
		What the Chancellor needs to announce in the budget next week The Chancellor is set to announce the Autumn Budget 2025 next week. What do I feel she needs to announce to make it a credible plan for businesses to see? It should certainly protect investment and avoid blunt tax hikes ......
		How employers can improve work-life balance for their employees With the state of the economy, everyone is feeling it. That's why our teams must work efficiently and not stress about their lives. Here's how employers can improve work-life balance for their employees with pragmatic, low‑fr...
		2025/26 company car taxable benefits: what drivers and employers need to know What are the company car taxable benefits for 2025/26? Well, with CO2 bands, list price rules, and future rate rises, this is a clear, upbeat take on HMRC changes. Use it to plan your company cars and electric vehicles with c...
		How AI can help you prepare your tax return this year AI speeds up data capture and checks, while accountants provide guardrails. Use both to prepare your tax return with fewer errors and less hassle. It's efficient, affordable, and grounded in human oversight ......
		What Reeves' pre-budget speech didn't say and what it could mean for you I'm uneasy after Reeves' pre-budget speech because tax rises are definitely on the agenda now. So what might change - from Income Tax to frozen thresholds - and why? If you've a payslip or a mortgage, or even just a weekly fo...

Other bloggers you may like ...
		What the abolition of Section 21 means for both landlords and tenants Posted by Sarah Hannaford on https://blog.sarahpasolutions.co.uk Here's a summary of the abolition of Section 21. Landlords will need valid legal grounds and evidence to evict, and tenants will gain more stability. ...
		Preparing to retire: practical advice for small business owners Posted by Jacky Sherman on https://www.jackysherman.com Thinking about retiring from your business can feel a bit surreal. For many small business owners in the UK, the line between 'work' and 'life' has be ...
		Nine ways to beat the Budget tax burden this year Posted by Helen Beaumont on https://blog.essendontax.co.uk Here's my smart, simple guide to beat the Budget tax burden without drama. I'll cover pensions, ISAs, dividends, cash, IHT and more. Read this to prio ...
		Wolverton Solutions: harnessing AI for growth without inviting risk Posted by Andrew Parker on https://blog.wolvertonsolutions.com Here's a frank take on harnessing AI for growth while staying secure. It covers smarter adoption, practical defences, and what to watch out for. It's ...