Joshua Leigh & Co

Five reasons to set up a Personal Tax Account

Taxpayers are being urged to set up personal accounts to monitor their affairs.

The Association of Taxation Technicians (ATT) is encouraging taxpayers to set up a Personal Tax Account (PTA).

The call is after HM Revenue & Customs (HMRC), renewed their commitment to PTAs as part of a proposed single digital account for taxpayers, at their annual stakeholder conference, held at the end of last month. This shows PTAs are a key part of the tax authority’s 10-year strategy.

The PTA lets people check and manage their tax affairs. It was launched in November 2015 and HMRC reports that over 14m people accessed their account in the last tax year (2020/21). That saw a 21 per cent increase in PTA sessions compared to 2019/20, with over 53 million user sessions.

Now ATT says if people have not already set up a PTA, here are five reasons why they might find it useful:

1. Check your state pension and history of National Insurance contributions

In your PTA you can see your National Insurance record which counts towards your state pension. You can see how many qualifying years you have recorded and if there are any gaps. HMRC report that the ‘Check your State Pension’ service is popular in the account with more than one million sessions per month.

2. Avoid queuing on helplines

There are many simple tasks that can be completed quickly and easily online via the PTA. This avoids queuing on HMRC helplines which continue to be busy because of the Covid-19 pandemic. Basic tasks include changing your address or confirming and printing your National Insurance number. It is also possible to claim tax reliefs such as marriage allowance and keep track of your applications for reliefs or allowances online.

3. Complete your tax return

If you have self-employment or rental income, you can complete your tax return online through the PTA. It is easy to monitor your progress and, when complete, you can see your tax calculation, how much you must pay and when. It is also easy to update your return and claim reductions in payments on account if your circumstances have changed and your income has fallen.

4. Report a change in circumstances for tax credits

For those within tax credits, it is possible to report changes of circumstances quickly and easily to HMRC through the PTA to ensure that you receive the correct amount of tax credits and do not end up running up over or underpayments as your circumstances change.

5. Check your PAYE details

For those with employment income, you can use the PTA to check the details of your employment(s), pension(s) and other income information which HMRC holds and correct anything that is wrong. It is also possible to view details of how your tax code has been worked out. You can also claim tax relief for home working, which will be relevant for a lot more people because of the pandemic.

Jeremy Coker, president of the ATT, said: ‘We urge anyone who is yet to sign up for their Personal Tax Account to do so and explore how it can help them to understand and manage their tax affairs better. Although we have only set out five reasons, there are a lot of other helpful functions in this useful service. I particularly like that you can track the progress of any claims that you have made.

‘For those who can engage digitally with HMRC, it is potentially a much quicker route to get an answer about tax than queuing on a helpline.’

For help and advice on personal taxation contact a member of our expert team today.