first plus ppi claim offer

penguin99_2

Hi

I took out a loan with FP in 2005 of which 11,061.15 was for PPI. I settled the loan in 2008. I claim PPI misselling with them and received a letter offer yesterday.

They have said they would like to offer a full refund of insurance premium less any early settlement , with interest incurred on premium to date plus 8% per annum

Ie

Original PPI £11.061.15
Interest incurred £4,003.81
Less early settlement. £0
Total value of refund £15,064.96
Value of 8% per annum £5,558.98 after 8% tax deducted

What is confusing me is the £0 less early settlement figure have they made a mistake?


Also how much refund should I receive I did just assume it was £5558.98. But on re reading letter is £15,064.96 on top of that. I dare not get too excited.

[Deleted User]

penguin99 wrote: »

What is confusing me is the £0 less early settlement figure have they made a mistake?

Did you actually settle early?
If you did, the PPI would have attracted a rebate of the total PPI cost.

You'll receive a refund of all PPI paid, plus attendant interest, plus 8% additional simple interest.

Well done on your success.

penguin99_2

Thanks for your reply. Yes I did settle early remortgaged in 2008 and paid FP.
I did inform them of this again on my PPI claim form. But I suppose when I paid them it included the full 11k PPI premium

penguin99_2

The letter says that the 8% per annum simple interest amount will be paid directly to me and will not be affected by any loan adjustments or claims made. But the letter doesn't say about how the payment of the £15,064.96 will be made

welshgasman

What would confuse me is the 8% tax deducted?

[Deleted User]

welshgasman wrote: »

What would confuse me is the 8% tax deducted?

The additional 8% interest is taxable. Some banks deduct this before paying out-others allow the customer to take the tax burden themselves.

penguin99_2

Moneyineptitude wrote: »

The additional 8% interest is taxable. Some banks deduct this before paying out-others allow the customer to take the tax burden themselves.

Yes FP are informing tax man on my behalf and have already deducted the tax from the figure.

welshgasman

Moneyineptitude wrote: »

The additional 8% interest is taxable. Some banks deduct this before paying out-others allow the customer to take the tax burden themselves.

I am aware of that, but it was stated 'after 8% tax deducted'

That is what I was confused about.

[Deleted User]

welshgasman wrote: »

I am aware of that, but it was stated 'after 8% tax deducted'.

I'm not sure it means that the tax deducted was at the rate of 8%, it just means the tax levied on the 8% interest.
Income tax is clearly not levied at 8%.

amersall

penguin99 wrote: »

The letter says that the 8% per annum simple interest amount will be paid directly to me and will not be affected by any loan adjustments or claims made. But the letter doesn't say about how the payment of the £15,064.96 will be made

They will send you 2 cheques, one for the refund and one for the 8%.
You would have received a rebate of this PPI when you settled, the remaining PPI would have been repaid by you in the settlement figure, the rebate could be a loan adjustment amount, see what they send you, it will still be a tidy amount.
:j Love a win with FP :j:j well done.

penguin99_2

Sorry

8% per annum simple interest gross amount. £6948.72
Deduction made for income tax at 29% £1389.74
Net payment of 8% interest after tax. £5558.98

May ring them to check I'm definitely expecting the £15k as well. If I'm am then I'll pass out
:j