A Guide to Reclaiming Overpaid Tax

Rough estimates indicate that over 4.3 million people will be eligible for a tax rebate this year, and the BBC estimates that her majesty’s revenue and customs will have to reimburse approximately £1.8 billion in overpaid taxes. In part, this is because people have moved jobs, stopped working or become self-employed mid-way through the financial year, which confuses the complicated system employed by HMRC to calculate tax returns, and results in the government taxing people for money that they haven’t actually earned.

There are a number of other reasons that people over pay their taxes though; sometimes they don’t realize that they can claim money back from special tax allowances, and sometimes they forget to update their PAYE tax code, which HRMC use to calculate your estimated income.

Anybody that’s paid too much tax because they’ve swapped jobs part way through the financial year can claim for a tax rebate immediately. You might also be eligible for a rebate if you work in a profession that benefits from specific tax relief schemes.

If you’re a mechanic, for example, you will be able to claim a rebate for any tools, boots or overalls that you are required to purchase in order to work, but not reimbursed for by your employer. Educational professionals will also be entitled to claim teacher tax rebate on any union fees paid over the course of a financial year, and any sporting equipment bought to facilitate the teaching of P.E. lessons.

People that have been working under an emergency PAYE code can also reclaim any overpaid taxes, as can anyone that was made redundant mid-way through the financial year.

How Do I Begin Reclaiming Overpaid Tax?

If you think you might have overpaid your taxes, and you suspect that you might be eligible for a rebate, the first step is to properly calculate your taxable earnings, and deduct the cost of any expenses covered by relevant tax relief schemes.

Once you know how much tax you should have paid over the course of the financial year, you can compare this number to the amount listed on your p60. If you haven’t been issued with a p60, or the information that it contains is incorrect, you can contact HRMC to find out how much tax you’ve paid in a given financial year.

Once you’ve worked out how much tax you’re owed, you can write to Her Majesty’s Customs and Revenue to file a claim, and begin properly reclaiming your tax. As long as you make a claim within 4 years of the relevant tax year, you should be reimbursed.

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