Income tax deducted from statutory compensation

Chris4PPI

Hello all,

I can't find an answer or thread elsewhere, so apologies if one exists.

My question concerns the deduction of income tax from statutory compensation interest. The interest is taxable, but since when do financial institutions forced to pay compensation for PPI mis-selling have the right to deduct income tax ?

Starting April 2016, financial institutions were required to pay all interest gross (for example, see
:money: moneysavingexpert.com/news/savings/2016/04/all-savings-now-to-be-paid-tax-free and taxation.co.uk/Articles/2015/04/14/332906/all-change ).
How does this statutory interest differ ???

I cannot go running after the PPI mis-seller and demand they hand over the withheld income tax because the concept of an R85 ceased to exist in April 2016. Nor do I want to wait until after the end of the tax year to claim it back from HMRC.

This situation happened to me with a recent Barclaycard mis-selling claim. It didn't happen with previous successful claims I made against a variety of other loan and credit card providers way back in 2013/14.

Hard to believe there aren't some hard-n-fast rules from FCA of FOS, but so far I've drawn a blank :mad:

Anyone know the facts, please ?

[Deleted User]

Chris4PPI wrote: »

I can't find an answer or thread elsewhere,

Answered on the other thread on which you posted this question.
https://forums.moneysavingexpert.com/discussion/comment/73285711#Comment_73285711

Chris4PPI wrote: »

Nor do I want to wait until after the end of the tax year to claim it back from HMRC.

Just bang in a complaint to HMRC, you might get lucky;)

societys_child

since when do financial institutions forced to pay compensation for PPI mis-selling have the right to deduct income tax ?

Since HMRC told them they had to?

Floss

TBH, if you weren't reclaiming the PPI, you wouldn't have been given any money to pay extra tax on, so why be bitter about paying tax on a bonus? Just claim it back next April.