Tax Reclaim On PPI

cedwards1976

Hi Martin
I have seen the information on your sure about PPI tax reclaim, back in 2017/2018 tax year, we had approx £17K reclaim on PPI. I have written to the lenders to get a copy of the calculations for the reclaim, is this all I will need to complete the HRMC form? Roughly how much refund would we be due? We are both basic rate taxpayers 
Many thanks 
Caroline Edwards 

[Deleted User]

You need to complete Form R40 from HMRC which is a simple tax return requiring you to enter the details of the tax you paid on the interest element of your PPI refund (not the total  PPI refund amount) as well as any other tax you paid elsewhere during the tax year in question. 

How much you are "due" (if anything) will depend on your individual tax position and any other interest you earned elsewhere. 

"Martin" will never read  or respond to your  post since he sold this site some years back and takes no active part in it's running.  

Dazed_and_C0nfused

Roughly how much refund would we be due? 

If the payment was in joint names then it's highly likely to be between £0 and £200.  The exact amount is likely to spend on what other interest you received in that tax year.

It could be more but as basic rate payers chances are it won't be.

If the interest takes you into the higher rate bracket you may owe additional tax to HMRC rather than getting a refund.

Stevebrailsford

Am I correct in believing that as a basic rate taxpayer the maximum reclaim is £200

(20% of the £1,000 savings allowance) ?
if so why is this ?
we have had over £3,000 tax deducted on interest
which if it had been applied over the years it was accrued the majority of it would have been tax free
how is it legal to tax it as if it was accrued in one year ?

[Deleted User]

Because you earned the interest in the one year.

Stevebrailsford

No I earned 8% a year 

[Deleted User]

No. It was calculated on the previous years and earned in the one year.

Stevebrailsford

That’s not how savings work 
just look at capital gains ?

Stevebrailsford

The judge when announcing the ppi compensation scheme, said it was designed to put people back in the situation they would be in if they hadn’t taken out PPI, This doesn’t achieve that ! 

[Deleted User]

It does, and then more on top of that. You don't get 8% in the bank.

milosimab

Hi 
I am trying to fill in the R40 form to reclaim tax on PPI payout in 2018.  I am not sure if got any interest on some small accounts I might have had that year and I am not sure which ones I had but the interest would have been under £50 in total.  I have managed to track down one which was approx £15 but I am not sure if I had others, should I continue with the form without them?