Martin Lewis: Had a PPI payout? If so, you can reclaim the tax on it

speedfreak_2

I had 3x seperate PPI payouts in Feb 2019, all from RBS, do I need to fill in 1x R40 form to cover the total tax reclaim of all 3 payouts or 1x R40 form per claim?
The payout was in joint names and the monies paid into our joint account. My wife's a non tax payer. Do we have to claim for half the payout each or can I claim for all of it?

Dazed_and_C0nfused

It is one R40 per tax year and one per person so you would each need to complete one form, declaring half the statutory interest/compensation on each one.

An R40 is like a simple tax return, you each declare your entire taxable income for that tax year on it and HMRC will then calculate your tax position and establish if any refund is due (highly likely for your wife less so for you).

happyandcontented

Dazed_and_C0nfused said:

It is one R40 per tax year and one per person so you would each need to complete one form, declaring half the statutory interest/compensation on each one.

An R40 is like a simple tax return, you each declare your entire taxable income for that tax year on it and HMRC will then calculate your tax position and establish if any refund is due (highly likely for your wife less so for you).

I thought Martin Lewis said that if you hadn't had £1000 interest on monies saved (for new PPI refunds) then you would be eligible to reclaim. I didn't realise it was income-dependent as well.

GlennTheBaker

I and Mrs Baker sent the forms in at the end of February and yesterday received cheques from HMRC totalling £385 👍🏻

Dazed_and_C0nfused

happyandcontented said:

Dazed_and_C0nfused said:

It is one R40 per tax year and one per person so you would each need to complete one form, declaring half the statutory interest/compensation on each one.

An R40 is like a simple tax return, you each declare your entire taxable income for that tax year on it and HMRC will then calculate your tax position and establish if any refund is due (highly likely for your wife less so for you).

I thought Martin Lewis said that if you hadn't had £1000 interest on monies saved (for new PPI refunds) then you would be eligible to reclaim. I didn't realise it was income-dependent as well.

Most interest, whether from a (non ISA) savings account or part of a PPI refund is taxable.  A lot of people can have £1000 taxed at 0% which would often mean a £200 refund if your only interest was from the PPI refund.

Some people can have £6,000 taxed at 0%.

Some can have £18,250 with any tax being payable.

It all depends on your overall tax position.  The statutory interest/compensation paid out as part of a PPI refund is no different to any other taxable income.

cas13g

Hi, I received ppi payment back in march 2020 and paid £478 tax on it..I've called HMRC who told me I cannot get a refund as I have used up my personal tax allowance for 19/20..I pay tax at the normal tax rate and only used about £20 from my personal interest allowance..The person I spoke to told me that doesnt matter as ppi tax is nothing to do with the interest allowance..I asked her several times why I couldn't claim the tax back just for her to tell me she doesnt know and will send a letter out to 3explain it..Am I able to claim the tax back or is she correct?

JEdgar24

Martin, my wife has received a PPI payout and wishes to claim the tax back via her self assessment. Is there a particular area of the self assessment that she needs to complete to claim the tax back.

Dazed_and_C0nfused

She just includes the taxable income (the statutory interest element) on her return as she would any other taxable income.

She needs to find the bit for taxed interest.

If she completes the return without the taxed interest and checks her tax calculation, keeping a note of the bottom line (tax owed or overpaid) and then add the interest and look at the revised calculation you will be able to see how much tax has been overpaid (if any).

cas13g

Hi Martin,
I'm having problems claiming back £400 tax I paid on a ppi refund I recieved this March..HMRC are telling me I've paid the correct amount of tax and used up my tax allowance for year 19/20..They have also told me that the personal savings allowance is not to do with it and therefore I cannot claim the tax back..I'm confused as the company who claimed the ppi for me told me that I could claim the tax back..
Can you help please..

Justjill1

Hi Martin can you only claim the tax back on PPI if you are a none tax payer? I’ve applied for tax back on PPI that I’ve received over the past 3-4 years & the tax office are saying I owe them money 🤔 which I’m not convinced is right. I phoned the tax office this morning after waiting  45 minutes to get through to a really rude & unhelpful gentlemen who said you were giving the wrong information out & then rudely cut me off! Tried to call back & I can’t get through now it just keeps saying we are experiencing high call volumes 😕 to be honest the R40 form has been a bit of a nightmare to fill in, & I’ve been sending the form backwards and forwards trying to get it right so now I’m stuck with a bill for just short of £500 that I’m supposed to owe them! Wish I hadn’t of bothered 😕 any help is greatly appreciated.