HMRC urged people to claim their dues
HMRC has issued a warning to taxpayers urging them to verify whether they have overpaid tax and claim any refunds owed to them. The tax authority highlighted that a ‘million’ people have failed to claim their dues and explained how people can determine if they could be amongst them.
Tax refunds are owed to those who pay too much income tax within a single tax year, something that can happen for various reasons. HMRC no longer automatically issues PAYE refunds, meaning taxpayers must take action themselves to reclaim any overpaid tax.
The most recent HMRC figures showed that over 730,000 PAYE refunds went unclaimed last year, with the average refund worth approximately £855 – meaning Brits collectively left a staggering £624million with the taxman, according to Sky News.
Posting on X, the official HMRC account encouraged people to log into the HMRC app to reclaim any tax they are owed, though there are multiple ways to check eligibility and secure a refund.
Taxpayers can use the checker tool on Gov.uk to discover whether they may be entitled to a tax refund. In most cases, those who have overpaid tax will also receive a P800 tax calculation letter following the end of the tax year in which the overpayment took place.
The letter will contain a complete breakdown of HMRC’s calculations, detailing how much tax you should have paid versus how much you actually paid. Should you believe there is an error in these figures, you will need to contact HMRC directly.
These letters also include guidance on how to claim your money and will indicate whether this can be done online via the official Government website. Alternatively, you can request a refund through your personal tax account, the HMRC app, or by contacting HMRC directly.
Taxpayers must claim their refund within four years. Once submitted, the refund should reach you within five working days if claimed online, or within six weeks if you chose to have a cheque posted to you.
Your P800 letter may instead confirm that HMRC will issue you a cheque, in which case you should expect to receive it within 14 days of the date shown on your letter. MoneySavingExpert has previously cautioned taxpayers to stay alert to texts, emails or calls relating to tax refunds, as HMRC will always get in touch by post regarding refunds, and fraudsters may try to take advantage of those expecting money back.
Tax refunds can be issued if you paid too much tax on:
- pay from a job
- job expenses such as working from home, fuel, work clothing or tools
- a pension
- a Self Assessment tax return
- a redundancy payment
- UK income if you live abroad
- interest from savings or payment protection insurance (PPI)
- income from a life or pension annuity
- foreign income
- UK income earned before leaving the UK
UK income earned before leaving the UK. One of the most common reasons for paying the incorrect amount of tax is having an inaccurate tax code, which can happen if you change jobs during the tax year and may lead to you not receiving the proper personal allowance.
