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How to claim a PAYE refund


If you have paid too much tax, you will be able to get a refund from HMRC. The mechanics for obtaining your refund depend on how the overpayment arose. Claims must be made within four years from the end of the tax year to which the refund relates.


PAYE overpayment

If you pay tax under PAYE, for example, on income from employment or a pension, an overpayment may arise if your tax code is incorrect if you worked at the start of the tax year but did not work for the full tax year.


If you have paid too much (or too little) tax, HMRC will send you a tax calculation letter (P800). If the letter indicates that you are owed a tax refund, you will be to claim the refund either online via the Gov.uk website or through the HMRC app.


A claim can be made online by signing into your personal tax account, selecting ‘Claim a refund’ and following the instructions. A refund can also be claimed via the HMRC app. To do this log into the app and select PAYE, which will show a summary of your tax position.


If you are due a tax refund, the summary will show the amount of tax that HMRC owes you. You can make a refund claim by clicking the ‘Claim a refund’ button and following the instructions.


The repayment should be made within two weeks. However, if you have not received it in this time frame, HMRC asks that you wait four weeks before contacting them.


Interest

HMRC will pay interest on the overpaid tax from the date of payment to the date of refund. The rate is set at the base rate of less than 1% (subject to a minimum rate of 0.5%). From 21 February 2023, the repayment interest rate is 3%.


Beware of refund scams

Fraudsters may send scam texts or emails that promise tax rebates to trick people into providing their bank details. HMRC does not contact taxpayers by text or email to advise them that they are due a refund. If you think you are due a refund, check either your personal tax account or the app, and where one is due, claim through the correct channels.


For more go to the gov.uk website

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