Is your online tax account riddled with mistakes?

Millions are — so follow our simple guide to set your record straight

LeSS than half of all taxpayers have logged on to vital digital accounts that reveal whether they are paying the right amount of tax.

More than 15 million people risk leaving errors on their files because they haven’t checked them, official figures reveal.

The online accounts, created by HM revenue & Customs in 2015, show for the first time what the taxman knows about your income, state pension and National Insurance record.

They are part of the taxman’s drive to make individuals responsible for ensuring their tax code is correct.

experts say millions of people could have errors lurking in their so-called personal tax accounts and must check immediately.

Here, SARA SMYTH explains how to understand your online account — and how to correct any mistakes.

GET REGISTERED

To ACCeSS your account, enter your name, email address and create a password at gov.uk/personal-tax-account.

A 12-digit Government Gateway user ID will be emailed to you — make a note of it because you’ll need it every time you log in.

You’ll have to supply your mobile or landline number. An access code will then be sent by text message or via an automated call.

enter this code on the site and you’ll need a passport, payslip or a P60 form to hand.

The system will ask a series of security questions based on the document you choose to verify your identity.

Now you’ll be taken to your account, where you can start checking the information the taxman has gathered about you.

DECIPHER THE CODE

LAST year, 6.7 million people paid too much or too little tax because they were on the wrong tax code.

The codes are a series of numbers and letters used to calculate the amount of tax that should be deducted from your wages or pension before you get the money. They’ve always appeared on payslips, but this is the first time your code appears next to the taxman’s account of what you earn and how much you owe. It gives a much fuller picture of your affairs.

Your tax code is listed under the ‘Income’ section of the site. If you work for several employers or work and draw a pension, you’ll have more than one code.

Click on the link ‘ Understand your tax code’ for a breakdown of how much has been skimmed off your earnings by the taxman.

There, it will show how much you can earn before you start to pay tax. for most people, this will be the standard £11,500 personal allowance for the 2017-18 tax year (£11,850 for 2018-19).

Any untaxed income — such as rent from a property — is known as your ‘taxable deduction’ and should be listed here.

The deductions are taken off your basic personal allowance.

To create a tax code, HMrC removes the last digit of this number, say 1150, and uses it as the number part of your tax code.

The letters also have meanings. for example, ‘L’ means you’re entitled to the standard personal allowance, ‘M’ shows that you’ve received marriage allowance from your partner and ‘N’ that you’ve given this to your partner.

To report an inaccuracy, call 0300 200 3300. Keep your National Insurance number to hand.

LOOK FOR ERRORS

THe taxman’s record of your earnings may be out of date. You can use your digital account to set the record straight.

follow the ‘View your income tax estimate’ link in the Income section at the top of the site.

If the figure is wrong, you can change it yourself. Click ‘ View employment details and company benefits’. You will then find an option that allows you to ‘Update your estimated income’.

The tool asks if your working hours have changed, how often you are paid and how your salary appears on your payslip.

from this information, it estimates what you earn annually and updates the records.

Self-assessment taxpayers, the self-employed and those with multiple sources of income can update their tax return, file it and make payments at any time of the day or year though the account.

PENSION CHECKER

IN THe ‘Pensions’ section at the bottom of the site, you’ll find a summary of your state pension.

It shows how much you are expected to receive and when.

Your National Insurance record is listed here, with years of full contributions and any gaps. It also shows how many years lie ahead before you will receive the state pension.

To qualify for the new state pension, worth £159.55 a week, you need 35 years of full NI contributions. Telephone HMrC (0300 200 3300) if you think it has the wrong information about you.

You can fill in gaps from the past six years by topping up with a lump sum. Most people won’t need to if they have many years left to fill the gaps before retiring.

But if you don’t think you’ll have time, call the future Pension Centre on 0800 731 0175 for advice.