Claiming tax back on a PPI refund

nobbys_nuts

Hi all, just caught the back of a segment on the Martin Lewis Money Show where they were talking about claiming tax back on pip refunds?

Last July I received £24,000 back from Clydesdale Yorkshire bank, at the time I was earning around £50k a year. Is this something I could do? Is it worth it?

Thanks in advance.

societys_child

Non tax payers can reclaim using form R40.
On £50k I imagine this won't apply to you . .

Dazed_and_confused

You need to tell HMRC about the interest added to the PPI refund (not the actual PPI refund itself).

You will almost certainly owe additional tax in your case.

antrobus

nobbys_nuts wrote: »

....
Last July I received £24,000 back from Clydesdale Yorkshire bank, at the time I was earning around £50k a year. Is this something I could do? Is it worth it?
...

Probably not.

Tax is deducted at 20% from the interest element. The interest is taxable at 20% for basic rate taxpayers. It's most likely that you are not due a refund. Depending on the exact number for the "around £50k a year" you earned, plus any other income, you might owe tax.

If you post the numbers, someone will likely work it out for you.

binnie

Hi My husband needs to do this and just spent a long time in a queue only to be told to fill in a R40 form.
The thing is we can't find his P60 but we do have a letter with everything on it as he had a tax refund with paying too much tax on his avc pension payout.

We don't understand the R40 form and hope someone can help us please.

The figures are

Hargreaves Lansdown Assets (which is AVC payout) Income £3548.01, tax paid £517.60.
His works private pension £8462.00, tax paid zero.

His personal allowance was £11500
Taxable income £510.01

Income tax rate 20% Income £510, Income Tax £102

HMRC refunded him £415.60


Then we got a PPI refund in October 2017

Refund of premiums £679.14
Interest £0.00
C 8% Statutory Interest £1,204.02

Fees for Gladstone Brookes £564.95

Tax deduction £240.80

We don't have any savings

Just don't understand the form where it says Uk employment income, pensions etc, do we just put his private pension there.
Where do we add the Gladstone Brookes pension pot he got, then the tax he paid.

Then the Uk interest and dividends it says net interest, do we put £1,204.02 in that box and tax taken off £240.80?

Then it says gross amount, the amount before tax taken off, what do we put there

Do we just jump to section Any other income and benefits for the Gladstone brookes avc payout

It's very complicated

Many thanks for your help

Dazed_and_confused

Hargreaves Lansdown Assets (which is AVC payout) Income £3548.01, tax paid £517.60.
His works private pension £8462.00, tax paid zero.

This goes in the the pension income section.

C 8% Statutory Interest £1,204.02

Fees for Gladstone Brookes £564.95

Tax deduction £240.80

The interest goes in the taxed interest section (you may need to just enter the net interest figure i.e. after tax was deducted (approx £963).

Where do we add the Gladstone Brookes pension pot he got, then the tax he paid.

You haven't told us anything about a pension from Gladstone Brookes. Do you mean Hargreaves Lansdown? If so see first answer above.

As he's a basic rate taxpayer the PPI interest will all end up being taxed. The good news is that tax rate is 0% so he should get an additional refund of £240.80

Stephieg22

Hi I saw person above was entitled to her £240 tax paid on PPI back, but I’m finding it very confusing.
I too get a Medical pension from my previous employer ( around £10,300 a year ) and also got taxed around £223 ( on interest) on a payout for one item and then several smaller claims got taxed various amounts of between £80-£200) on a couple of others , is there a post that explains how to claim money back from HMRC, and if you are a basic rate tax payer , are you still entitled to this tax back on the ‘premise’ that if this was your savings you wouldn’t be taxed?
I’m so confused by what Martin Lewis said on the show , as it seems like you are entitled to money back, but only if you fall into certain categories... can anyone advise/help please?
I don’t know how to add photos so can’t show the PPI photos

Nasqueron

Stephieg22 wrote: »

Hi I saw person above was entitled to her £240 tax paid on PPI back, but I’m finding it very confusing.
I too get a Medical pension from my previous employer ( around £10,300 a year ) and also got taxed around £223 ( on interest) on a payout for one item and then several smaller claims got taxed various amounts of between £80-£200) on a couple of others , is there a post that explains how to claim money back from HMRC, and if you are a basic rate tax payer , are you still entitled to this tax back on the ‘premise’ that if this was your savings you wouldn’t be taxed?
I’m so confused by what Martin Lewis said on the show , as it seems like you are entitled to money back, but only if you fall into certain categories... can anyone advise/help please?
I don’t know how to add photos so can’t show the PPI photos

You need to submit form R40 as stated above to claim back the tax on the interest element of your refund. HMRC will then assess it. If you have not earned £1000 in interest in the tax year you should get the refund so long as you are not a higher rate tax payer

[Deleted User]

Stephieg22 wrote: »

Hi I saw person above was entitled to her £240 tax paid on PPI back, but I’m finding it very confusing.

Contact HMRC who will provide the relevant form for you to fill out and decide whether you are due any refund. Don't expect anything back before Xmas though...

Stephieg22

Thank you, appreciate you taking the time to reply and advise me ⭐️😊

Stephieg22

Thank you, I appreciate you taking the time to reply and advise me ⭐️😊