I need an expert to give me some PPI 20% tax deduction help

the_real_eagle · 13 November 2019 at 10:06PM

Hello - Excellent site - has helped me to successfully claim back over £9k - I am grateful for the help and advice.

This is my question/situation and I need your help please:-

Without taking the PPI monies into consideration I am going to earn/can limit to about £42500 I also get a company car taxable value of £5313 and a tax code of i think 653L.

I type this into various salary calculators and it tells me that this is pretty much the limit I an earn and remain paying 20% income tax.

So of the £9k PPI cheques I have received, £8020 (three different payements) was in the last few weeks - the other was in 2015.

So - Firstly, do I need to report this 2019 money to HMRC as income? Therefore instantly going into the 40%

Secondly the compensatory interest on the 2019 payments equates to £5468 and I have therefore been 'stopped' £1093 so if I keep my earnings at the predicted amounts would I be able to fill out a form and claim back £1000 of this money or if I earn a couple of quid more and just cross the 40% threshold would this then be reduced to £500 or am I barking up the wrong tree?

Sorry if this is a basic question - I just need a bit of support. Thanks in advance.

Dazed_and_confused · 14 November 2019 at 9:52PM

So - Firstly, do I need to report this 2019 money to HMRC as income? Therefore instantly going into the 40%

Yes and no. PPI refunds aren't taxable income and tax isn't deducted from them. The interest element is taxable so you report that, and the tax already deducted. You don't tell them anything about the PPI refund.

would I be able to fill out a form and claim back £1000 of this money or if I earn a couple of quid more and just cross the 40% threshold would this then be reduced to £500 or am I barking up the wrong tree?

You are barking up the wrong tree. I have no idea why you think you might be entitled to either £1000 or £500 of the tax deducted back

You haven't provided sufficient information to know how much of a refund you might get (or extra there could be to pay).

All of the interest (plus any other non ISA interest you get during this tax year) is taxable.

From what you have posted some will be taxed at 0%. Some may be taxed at 20%. And some will be taxed at 40%. This may end up being more or less than the £1,093 that has already been deducted.

You need to provide details of how your tax code has been calculated and how much other interest you will receive in the current tax year before an idea of any refund/extra tax due can be worked out.