How do I claim back tax I have overpaid through PAYE on wages or pensions? (2023)

This section looks at what to do if you have paid too much tax on your wages or pension and what the time limits are for making a claim.

First though, we look briefly at HMRC’s P800 tax calculation process, which may mean you do not need to claim a repayment, as HMRC will issue any repayment automatically. If you have not received a P800 tax calculation from HMRC, and you have overpaid tax, you will need to make a claim for a tax repayment.

What is a P800 tax calculation?

Your employer or pension provider gives HM Revenue & Customs (‘HMRC’) details of how much income you have received, how much tax you have paid and the value of any benefits in kind you have received during the tax year.

Using this information, HMRC carry out an automatic reconciliation at the end of each tax year, to work out whether or not you have paid the right amount of tax. If HMRC think you have not paid the right amount of tax, they send you a P800 tax calculation. This calculation will show you what tax HMRC think you should have paid.

You must always check your P800 tax calculation carefully, as HMRC may not have all the information they need to calculate your tax correctly, or they may have inaccurate information.

If HMRC think you have overpaid tax, they will send you a repayment of tax automatically – you do not need to make a claim.

If HMRC think you have not paid enough tax, they will write to you explaining that they intend to collect the underpaid tax through your tax code or telling you how you can repay it to them.

(Video) Claiming tax back on your pension contributions

For more information on what to do if you receive a P800 tax calculation, please read our section ‘When things go wrong’, ‘Complaint or Appeal’

How do I claim a refund for the current tax year?

If you receive employment income or pension income and pay tax through the PAYE system you may sometimes pay too much tax. There are various reasons for this. HMRC provide a list of typical reasons for an overpayment of income tax arising on employment income. They also provide a list of reasons why an overpayment might arise on pension income.

If you think you have overpaid tax through PAYE in the current tax year, before the end of the tax year tell HMRC why you think you have paid too much. It is probably best to telephone them initially, the helpline for individuals and employees is 0300 200 3300.

Before you telephone HMRC, you will need to gather together:

  • your personal details – such as your full name, address, date of birth and National Insurance number;
  • details of each of your employers or pension providers – their PAYE scheme reference number, which should be shown on your payslip, or ask your employer or pension provider for it;
  • estimates of your earnings and pensions from each source for the current tax year.

Make sure you keep a note, in a safe place for future reference, of:

  • the date and time of the phone call;
  • the name of the adviser you spoke to; and
  • what was said by both you and the HMRC adviser.

You may need to send in more information to support your claim and if so HMRC will let you know what paperwork you should supply.

Once HMRC process your claim it might be necessary to issue you with a new tax code, meaning any refund will be added to your wages or pension and the amount will generally be paid automatically through the payroll. This will result in a lower tax deduction or a tax refund through PAYE.

(Video) How to Defend a Claim of "Benefits~Overpayment"

However if the repayment is due towards the end of the tax year and you have already received your final pay for that year, you may have to claim a refund directly from HMRC.

How do I claim a refund if I have stopped working part way through the tax year?

If you have stopped work part way through the tax year and are not going to have a continuing source of taxable income, for example, you are not intending to go back to work within four weeks or claiming a state benefit, you should be able to claim an in-year tax repayment using form P50.

You must send parts 2 and 3 of your P45 together with form P50 to HMRC. If you are entitled to a repayment of income tax, HMRC will send it to you – usually by cheque in the post.

You cannot use form P50 if you are claiming, or intending to claim a state benefit such as jobseeker’s allowance (‘JSA’).

If, for example, you stop work in June, having been employed at some point since the beginning of the tax year on 6 April, and you do not get another job but start to claim JSA, you will need to let Jobcentre Plus have your form P45 from that paid work. They will then put the details onto their computer. If you have already paid some tax under PAYE in the year, you will not get this refunded until the earlier of:

  • ceasing to claim JSA – in which case your refund comes from Jobcentre Plus;
  • the end of the tax year – in which case, you have to liaise direct with HMRC for your refund.

How do I claim a refund after the end of the tax year and for previous tax years?

If you have paid too much tax through your employment and the end of the tax year in which you overpaid tax has already passed you can make a claim for a refund by writing to HMRC.

Mark the top of your letter clearly with ‘repayment claim’ so that HMRC prioritise it on receipt.

(Video) Early flexible pension withdrawals & the emergency tax headache

You can write to HMRC using the tax office address of your current employer or the postal address on the most recent correspondence you have from HMRC. If you do not have any recent documents or letters from HMRC, write to:

HM Revenue & Customs
Pay As You Earn and SA
BX9 1AS

Generally your letter, should include:

  • give your full personal details – your name, address and national insurance number;
  • include as much information as possible about your employment history, for example, PAYE reference numbers for your employers, dates of employment, how much you earned and how much tax was deducted;
  • enclose copies of P60s and P45s if you have them – keep the originals;
  • say why you think you are due a repayment;
  • be signed and dated in ink.

Keep a copy of your letter and any enclosures and ask the Post Office for a proof of posting in case of later query.

HMRC say they usually aim to process PAYE repayments within four weeks of receipt. In some cases, HMRC will need to carry out security checks. It might help to speed up the repayment if you ask HMRC to pay it direct to your bank account. To request a direct bank transfer, include in the letter:

  • the name of the account holder(s);
  • the sort code; and
  • the account number.

But be aware that HMRC might want to make additional security checks if you request repayment into an account which is not in your own name.

In most cases you can get back the tax you have overpaid as long as you claim on time. The time limits for claiming a refund are shown in the section below. If you fail to make a claim within the time limit you will miss out on any refund due.

(Video) Don't Forget To Claim Extra Tax Relief On Pension Contributions!

What can I do if I am too late to make a claim for a repayment?

Claiming back tax for 'closed' tax years - Extra-statutory Concession B41

If you think you have overpaid tax in tax years that are ‘closed’ to reclaims, there is a rule known as Extra-statutory Concession B41 which can allow HMRC to repay tax for those earlier years. This only applies in limited circumstances.

This concession only applies in situations where HMRC or another government department, such as the Department for Work and Pensions, have made an error in your tax affairs and where there is no doubt about the facts of the case.

The relevant part of the concession reads as follows:

‘....However, repayments of tax will be made in respect of claims made outside the statutory time limit where an over-payment of tax has arisen because of an error by HMRC or another Government Department, and where there is no dispute or doubt as to the facts.....'

In our experience, it is rare for HMRC to grant this concession so you will need to set out clear evidence as to what the error was, which resulted in you paying too much tax.

FAQs

How do I claim back PAYE overpayments? ›

HMRC will take the overpayment off your next PAYE bill. If you overpaid because you entered the wrong amount when paying HMRC , or you made a duplicate payment, you can balance your account by paying less in your next PAYE bill. You can also claim a refund if you've overpaid by contacting HMRC's employer helpline.

How do I get overpaid tax back from HMRC? ›

You'll be sent the money within 5 working days - it'll be in your UK account once your bank has processed the payment. If you do not claim your refund online within 21 days, HM Revenue and Customs ( HMRC ) will send you a cheque. You'll get this within 6 weeks of the date on your tax calculation letter.

Does PAYE tax get refunded? ›

If you stop work part way through the tax year, you may be due a refund of PAYE. This can also apply if you have been on a temporary or 'emergency' tax code – such a BR or week one / month one. Other incorrect tax codes may result in tax refunds. For example, this can happen where workers have multiple part-time jobs.

How far back can I claim overpaid tax HMRC? ›

If you're employed and making a tax rebate claim under PAYE, you can claim back overpaid tax for the last four tax years. This used to be six tax years, but was changed HMRC to just four years. For example if the current tax year is the 2019/2020 you can claim back to the 2015/2016 tax year only.

Do HMRC automatically refund overpaid tax? ›

If HMRC think you have overpaid tax, they will send you a repayment of tax automatically – you do not need to make a claim. If HMRC think you have not paid enough tax, they will write to you explaining that they intend to collect the underpaid tax through your tax code or telling you how you can repay it to them.

How do I contact HMRC about tax overpayment? ›

+44 135 535 9022
  1. the official HMRC app.
  2. your personal tax account or business tax account using HMRC online services.

Do HMRC automatically refund overpaid tax 2022? ›

Does HMRC Refund Overpaid Tax? Yes, HMRC does refund overpaid tax, sometimes automatically and sometimes through the refund application process. It's important to keep on top of your tax position because there are time limits on when you may make a claim for overpaid tax and apply for your tax rebate.

How do I claim tax back on my pension? ›

There are three steps to consider:
  1. You can normally take the first 25% of your pension tax-free - the rest is taxable. The amount of income tax due on the balance depends on your total income in the tax year.
  2. You may pay too much tax initially. ...
  3. You need to complete a HMRC form to reclaim any over-paid tax.

Why does it take so long for HMRC to refund overpaid tax? ›

Normally a refund takes 10 working days to process but can take longer if it has been chosen for additional security checks we can't give a timescale on that forum for security checks you would need to call the self assessment helpline on 0300 200 3310.

How long does a PAYE tax refund take? ›

The answer is usually somewhere between 5 days and 8 weeks, depending on a number of factors including the system involved (for example by PAYE or Self Assessment), whether you applied online or by paper; and whether HMRC make any security checks during the process. Read on to find out more.

How do I claim back emergency tax on pension lump sum? ›

You can reclaim emergency tax on pensions by contacting HMRC directly. They will check your tax record and, once you've settled any outstanding amounts due, they will issue a new tax code to your pension provider.

How long does it take to get a tax refund? ›

(updated July 7, 2022) We issue most refunds in less than 21 calendar days. However, if you filed on paper and are expecting a refund, it could take six months or more to process your return.

How far back can I claim tax relief on pension contributions? ›

Can I claim tax relief for previous years? You can make backdated claims for higher rate tax relief on your pension contributions, but there is a time limit. You can only claim back any tax relief for the last four tax years.

What is the tolerance for an overpayment HMRC? ›

When these under or overpayments are low – within a tolerance of £49.99 or less underpaid or £9.99 or less overpaid – they are not corrected through the tax system as it is not cost-effective. While this has been the case for many years, the ATS is expected to make this more visible to the public.

What is the time limit for a claim to overpayment relief? ›

Overpayment Relief and repayment claims are limited to four years. A special relief exists (see below) which can provide relief in cases where the taxpayer is out of time for appeal.

Why are HMRC not paying tax refund? ›

“HMRC are currently undertaking an increased level of checks to stop criminals abusing our Income Tax Self-Assessment repayment systems. This means that unfortunately some of our legitimate repayment customers have been experiencing delays in receiving tax refunds.”

Can I speak to HMRC in person? ›

How do I speak to a real person at HMRC? You can call HMRC direct Monday to Friday, 8am to 8pm, and Saturday, 8am to 4pm. They currently offer no service on Sundays or on Bank Holidays.

Is the HMRC 0300 number free? ›

Callers will only pay the same amount as a landline call to a 01 or a 02 number and the price is the same for calls from mobiles. 0300 numbers are generally included in any discount schemes or inclusive call minutes that claimants may already have with landline or mobile phone operators.

Can I chat online to HMRC? ›

You'll usually have the option to contact HMRC through an online form, webchat, by phone or by post. You can get extra support if your health condition or personal circumstances make it difficult when you contact HMRC.

How can I get my tax refund from 2022? ›

Don't take the standard deduction if you can itemize. Deduct charitable contributions, even if you don't itemize. Claim the recovery rebate if you missed a stimulus payment. Contribute to your retirement or other qualified plans.

How long do HMRC refunds take 2022? ›

If you're owed tax

To claim a refund, go to 'Request a repayment' from the left-hand menu within your HMRC online account. Allow 4 weeks for your refund to be sent to your bank account. You may not get a refund if you have tax due in the next 35 days (for example for a payment on account).

Will I ever get my 2022 tax refund? ›

Most taxpayers who file electronically and choose direct deposit will get their refund within 21 days, assuming there are no problems with the return, according to the IRS.

How long does a HMRC repayment take? ›

Repayments are usually made within 30 days of HMRC getting your VAT Return. Your repayment will go direct to your bank account if HMRC has your bank details. Otherwise HMRC will send you a cheque (also known as a 'payable order'). You can change the details that HMRC uses to make your repayment.

How does HMRC pay back overpaid tax self assessment? ›

How do tax repayments through Self Assessment generally work? If you overpay tax on your income and you complete a Self Assessment tax return, HMRC will deal with your repayment once they have processed your tax return. You can state in the tax return how you would like the repayment to be paid to you.

How do I know if I have a tax rebate? ›

If you are due a tax rebate HMRC will let you know by sending you a letter called a P800 or a simple assessment letter. P800 letters can also tell you that you haven't paid enough tax, so don't get too excited when one comes through your letter box.

How long does it take to get tax refund 2022? ›

Most filers who use this method should receive their refunds within 21 days of submitting their return online. If you mail your return, you can expect to receive your refund in about six to eight weeks from the date the IRS receives your return.

How do I get a p50z form? ›

For further guidance you can phone Tax Help for Older People on 01308 488 066. They are an independent charity who give free tax advice to older people on low incomes. If you need a large print version of the form phone the Taxes Helpline on 0300 200 3300. Have you had any income since leaving your last employment?

How do I claim tax back on my pension lump sum UK? ›

Use form P53 to claim back any tax we owe you on a small pension lump sum where you've had either a: trivial commutation of a pension fund (from April 2015 this only applies to small Defined Benefit schemes such as Final Salary or Career Average) small pension taken as a lump sum.

How far back can you file taxes and get a refund? ›

Claim a Refund

If you are due a refund for withholding or estimated taxes, you must file your return to claim it within 3 years of the return due date. The same rule applies to a right to claim tax credits such as the Earned Income Credit.

Are we getting a stimulus check in July 2022? ›

The state used federal pandemic aid to provide these direct payments to low-income residents, and more than 236,000 households received a payment. All payments were distributed by direct deposit or mailed check between June 23 and July 1, 2022.

Who do I call if I haven't received my tax refund? ›

Use Where's My Refund, call us at 800-829-1954 and use the automated system, or speak with an agent by calling 800-829-1040 (see telephone assistance for hours of operation). However, if you filed a married filing jointly return, you can't initiate a trace using the automated systems.

Do you get tax relief on employee pension contributions? ›

Your employer takes your pension contribution and the government's contribution as tax relief from your pay before deducting tax. You pay tax on what's left. Under this arrangement if you don't pay tax, you don't get tax relief, for example because you earn less than the tax threshold.

What is the tax free allowance for pensioners in UK? ›

You can take: all the money built up in your pension as cash - up to 25% is tax-free. smaller cash sums from your pension - up to 25% of each sum is tax-free.

Can overpayment be written off? ›

The DWP can agree to waiver (write off) the overpayment. However this will usually only be done in exceptional circumstances where recovery action will result in severe welfare issues for you or your family. The DWP will also look into the circumstances of the overpayment.

Do I have to pay HMRC overpayment? ›

If you have a tax credits overpayment you must pay back, you should deal with it as soon as possible. While having to pay back money can be worrying, there are lots of ways to pay HM Revenue and Customs (HMRC) - including in instalments.

Can I take back overpayment? ›

You have the right to deduct money from an employee's pay if you recently made a simple overpayment. Speak to them and let them know how you're going to claim it back.

What is the time limit to submit a claim? ›

Most states give you two years to file a car insurance claim, but depending on where your accident happened, you may have from one to 10 years to file. Time limits can vary by claim type, even within the same state. For example, the time allowed for a comprehensive claim may be different from a bodily injury claim.

How do I contact HMRC? ›

Example. The 'Income Tax: general enquiries' helpline is 0300 200 3300. Dial 18001 0300 200 3300 to contact the 'Income Tax: general enquiries' helpline by text relay. HMRC also offers a textphone service for some of its helplines.

How far back can DWP reclaim overpayments? ›

The standard period during which debts to the DWP can be reclaimed by them is six years. If the DWP tries to issue a county court claim against you for an overpayment of benefit, and you think it is older than six years, you can put in a defence. However, if you're planning to do this, you should seek legal advice.

What happens when you accidentally overpay an employee? ›

If you accidentally overpaid an employee and it's too late to initiate a reversal, you may be able to correct the error by simply reducing (deducting) the employee's gross wages on future payrolls. Check to see if you can still cancel or reverse the payment.

How long does an employer have to claim back overpayment? ›

You can claim up to 2 years back as long as there is not a gap of 3 months or more between deductions.

How do you handle payroll overpayments? ›

Instead, you can: Ask the employee to pay back the difference between the two net pays (i.e., what the employee received minus what they should have received) Deduct the amount from an employee's future paycheck. Spread the amount out evenly across several future paychecks and deduct.

Should you tell your employer if they overpay you? ›

If an employee does notice that an overpayment has occurred they should inform employers immediately. These overpayments will simply build up over time. But be warned, when the employer does notice the overpayments they can actually deduct it from the employee's next salary.

Should you tell employer if you were overpaid? ›

You find that you were paid more than you should have, do you have to report it? The answer is no. There is no legal obligation for you to report the overpayment. However, if your employer has noticed it, they will generally provide you with a formal notification.

How far back can an employee claim back pay for? ›

Employees can claim for a series of failed payments. Employees can only backdate their claim up to two years from the date the claim is made and only where there is no break in the chain of over three months.

How do you claim a tax refund? ›

How to Claim Income Tax Refund? The simplest way to claim your income tax refund is by filing a correct income tax return before the due date. While filing your return you can check the total advance tax payments under Form 26AS.

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