Tax codes confusing for one in six

Posted on February 10th, 2011 | Categories - News

Financial terms are too confusing for many Britons to get to grips with.

A new guide has been launched by learndirect to help people handle their finances better.

One in six people do not know how to read their tax code or check that they are paying out the correct level of tax on their earnings, according to a new survey.

Learning and skills organisation learndirect polled 3,000 people and found that two thirds of participants are too confused to make the right choices when it comes to their money with many struggling to manage their cash.

It also found that over a quarter of respondents cannot work out how to get the best value on mobile phones, television packages and even gas and electricity. One if four people said they find it tough to understand small print and technical jargon while 10% of participants sign up to services and products that are not right for their needs.

Learndirect has designed a learning guide aimed at boosting people’s financial knowledge to address the problem. The Worth Learning Guide contains tips and guidance on budgeting and savvy spending.

Independent financial expert Jasmine Birtles who worked with leardirect to create the publication said: “We all know times are tough and money is tight after the recent rise in VAT, as well as surging petrol and energy prices and other increases in the cost of living. People need the confidence to make good financial decisions, but this research shows that many don’t think they have the right skills to do that”.

John Rhodes, Head of Financial Capability at Citizens Advice, said that his organisation recognises that more people need to gain the skills to better manage their cash and make savings.