MSE News: Lloyds defeated as it withdraws from PPI legal action

Rich66

Hello, saw the Barclays statement too today. I have several claims in, one where the sales rep even said we would have a better chance of getting the loan if we took out ppi !! However we got a reply saying it was just out of the 'six year' backdating period and so wouldn't be considered. This was before the judgement.
So has the judgement told the banks it refers to all ppi's or is there a period like six years? We even have one going back to TSB 20 years ago, when they insisited we took out the cover to get the mortgage, but of course that was dismissed by them due to the time period.

di3004

Hi Rich

I understand it will be the case of them opening older cases, can't recall on how far back, but many have still made successful reclaims going back into the 90's etc.
However, it helps if you still have details going back that far which will help with your case.
I did also read that even though they do state - 6 years, if you have only became aware of the mis selling you can give it a go anyway.

Rich66

Thanks Di, my claims are in but were dimissed by the companies on the basis of the ppi's being from periods over 6 years. I'm hoping mine are ones they go back to due to the ruling. Here's hoping !!

marko-007

Hi sorry if i'm posting in the wrong area or asking something that has already been asked but, I was wondering now that the banks aren't going to appeal, does anyone have any idea on a time scale getting a decision on a claim? i have currently got 2 with lloyds tsb that i sent 6 weeks ago.

I believe they have 8 weeks to reply under normal circumstances but while the judicial review was running am i right in thinking it was taking a LOT longer for them to arrive at a decision?

Also now they are looking at the claims and not appealing will this speed them up?

Should i expect a decision (rejection) in the 8 weeks starting from when i sent the claims? as from what i've read on the forums it would probably take a lot longer if i wrote to the ombudsman?

Thanks for any help.

magpiecottage

CornishWander wrote: »

I wonder if the HMRC will tax claimwnts against any payments made especially as interest at 8%. I seem to remember they did do this some time on a very similar issue but cannot exactly recall the subject and the HMRC won the right to do this.

Generally, the capital reimbursed is non-taxable because it was the claimant's money all along but the interest IS taxable. Banks are likely to withhold basic rate tax and issue a certificate of the tax paid to the complainant. Smaller firms are more likely to pay the interest gross.

Either way, the complainant is then legally obliged to declare the interest to HMRC.

If you have used a claims management company, they will normally expect their percentage on the GROSS payment but I think you need to need to declare, and will be charged tax on, the full interest payment.

That would mean, for example, if you had an interest payment of £100 and paid a 40% fee to the CMC, they would get £40 and a further £8 to pass to HMRC.

You would also, if you were a basic rate tax payer, have to pay £20 to HMRC -leaving you with £32 of you £100 interest.

CornishWander

magpiecottage wrote: »

Generally, the capital reimbursed is non-taxable because it was the claimant's money all along but the interest IS taxable. Banks are likely to withhold basic rate tax and issue a certificate of the tax paid to the complainant. Smaller firms are more likely to pay the interest gross.

Either way, the complainant is then legally obliged to declare the interest to HMRC.

If you have used a claims management company, they will normally expect their percentage on the GROSS payment but I think you need to need to declare, and will be charged tax on, the full interest payment.

That would mean, for example, if you had an interest payment of £100 and paid a 40% fee to the CMC, they would get £40 and a further £8 to pass to HMRC.

You would also, if you were a basic rate tax payer, have to pay £20 to HMRC -leaving you with £32 of you £100 interest.

Hi,
Was quite sure this will be the case, just wanted all the claiments to realise that they could be liable rather than complain later and avoid a tax investigation in the future. I have not involvement in needing to or advise on PPI' or the like, just interteseted in the subject.

di3004

marko-007 wrote: »

Hi sorry if i'm posting in the wrong area or asking something that has already been asked but, I was wondering now that the banks aren't going to appeal, does anyone have any idea on a time scale getting a decision on a claim? i have currently got 2 with lloyds tsb that i sent 6 weeks ago.

I believe they have 8 weeks to reply under normal circumstances but while the judicial review was running am i right in thinking it was taking a LOT longer for them to arrive at a decision?

Also now they are looking at the claims and not appealing will this speed them up?

Should i expect a decision (rejection) in the 8 weeks starting from when i sent the claims? as from what i've read on the forums it would probably take a lot longer if i wrote to the ombudsman?

Thanks for any help.

Hi there

I did ask them this question myself, as I also have 2 with them, and been told there is no timescale, but they aim to get on with them as soon as possible, here is an email received today. Hope this helps.


Dear

Thank you for your recent communication sent to our Chief Executive. I have been asked to respond on his behalf.

I appreciate that it is frustrating for you not to be given a timescale as to when your complaint will be looked into. However complaints will be handled in date order and we are working with the regulators to ensure we meet their expectations in terms of how we’re handling the complaints and the timescales we’re working to.

I want to ensure any potential redress paid to you is right and this could take a little time. I can assure you that this further delay will not count towards the time limits in which you can refer your complaint to Court or FOS, should you disagree with the final outcome of our assessment.

Please be assured I will respond to your complaint as soon as possible, and as you have previously highlighted that there are issues with the Postal System in your area, I will e-mail you to let you know when my letter is being sent.

I trust this helps to clarify matters.

Yours sincerely


Customer Relations Manager – Lloyds TSB Group Operations

marshallka

magpiecottage wrote: »

Generally, the capital reimbursed is non-taxable because it was the claimant's money all along but the interest IS taxable. Banks are likely to withhold basic rate tax and issue a certificate of the tax paid to the complainant. Smaller firms are more likely to pay the interest gross.

Either way, the complainant is then legally obliged to declare the interest to HMRC.

If you have used a claims management company, they will normally expect their percentage on the GROSS payment but I think you need to need to declare, and will be charged tax on, the full interest payment.

That would mean, for example, if you had an interest payment of £100 and paid a 40% fee to the CMC, they would get £40 and a further £8 to pass to HMRC.

You would also, if you were a basic rate tax payer, have to pay £20 to HMRC -leaving you with £32 of you £100 interest.

http://www.hmrc.gov.uk/bulletins/tb72.htm

Goodwill payments could be argued...

Ex-gratia or voluntary payment: It is sometimes suggested that an interest addition is not taxable because it, or the compensation on which it is calculated, is paid “ex-gratia” or voluntarily. We accept that a truly voluntary payment cannot be interest, even if described as such, because the essential feature of an entitlement to it is absent. In practice, however, we consider it will be extremely rare for any payment arising from claims that a financial product has been mis-sold to be truly voluntary, since the redress is given in consideration of the complainant giving up a right of action.