Claiming PPI Interest has backfired on me BIG Style.

grahamm123

First of all it needs to be made clear that I am a PAYE person all through my working life. This means I have no experience with filling in a Self Assessment form. Anyway, I got stuck as to how to claim a fairly high Interest claim. My overall pot was around k, but the RBS took that money due to historical debt with them, even though I had successfully completed an IVA in 2012. Out of the 46k pot the RBS took approximately 26k, a PPI company who was helping me took 10k and I got 10k. I then heard on the MSE you can claim back interest via HMRC. I did this to the best of my ability but I may have made a mistake. I have early onset Alzeirmers  and not used to dealing with HMRC so asked them to complete the filling of my form. They did this and seemed very helpful. I provided that with all the PPI payout letters to and suddenly I owe he tax man just under 4k!!!!!!!!! I am at my wits end and if I hat any hair left I would pull it out!!!!! Can anyone help me please, I am desperate!!!! 

grahamm123

grahamm123 said:

First of all it needs to be made clear that I am a PAYE person all through my working life. This means I have no experience with filling in a Self Assessment form. Anyway, I got stuck as to how to claim a fairly high Interest claim. My overall pot was around 46k, but the RBS took that money due to historical debt with them, even though I had successfully completed an IVA in 2012. Out of the 46k pot the RBS took approximately 26k, a PPI company who was helping me took 10k and I got 10k. I then heard on the MSE you can claim back interest via HMRC. I did this to the best of my ability but I may have made a mistake. I have early onset Alzeirmers  and not used to dealing with HMRC so asked them to complete the filling of my form. They did this and seemed very helpful. I provided that with all the PPI payout letters to and suddenly I owe he tax man just under 4k!!!!!!!!! I am at my wits end and if I hat any hair left I would pull it out!!!!! Can anyone help me please, I am desperate!!!! 

Sorry for the long winded cry for help

[Deleted User]

If you're a higher rate tax payer as a result of the statutory interest paid, the it's correct that you would need to pay the additional tax.

Check the figures to make sure you put in the right numbers but on that size of payout, the statutory interest will be big.

Dazed_and_C0nfused

grahamm123 said:

First of all it needs to be made clear that I am a PAYE person all through my working life. This means I have no experience with filling in a Self Assessment form. Anyway, I got stuck as to how to claim a fairly high Interest claim. My overall pot was around k, but the RBS took that money due to historical debt with them, even though I had successfully completed an IVA in 2012. Out of the 46k pot the RBS took approximately 26k, a PPI company who was helping me took 10k and I got 10k. I then heard on the MSE you can claim back interest via HMRC. I did this to the best of my ability but I may have made a mistake. I have early onset Alzeirmers  and not used to dealing with HMRC so asked them to complete the filling of my form. They did this and seemed very helpful. I provided that with all the PPI payout letters to and suddenly I owe he tax man just under 4k!!!!!!!!! I am at my wits end and if I hat any hair left I would pull it out!!!!! Can anyone help me please, I am desperate!!!! 

Maybe you should calm down and explain properly what has happened as some of this doesn't make sense.

HMRC don't complete Self Assessment returns, that is your responsibility.  You cannot claim interest from HMRC.  Do you mean tax deducted from interest?

You do know PPI refunds aren't taxable and do not have tax deducted from them?

The statutory interest paid alongside PPI refunds is taxable and does have tax deducted from it.

Have you received a Self Assessment calculation, called SA302?

If so post the details and it should be possible to check if you do owe £4k or if you have got in a pickle.

[Deleted User]

grahamm123 said:

First of all it needs to be made clear that I am a PAYE person all through my working life. This means I have no experience with filling in a Self Assessment form. Anyway, I got stuck as to how to claim a fairly high Interest claim. My overall pot was around k, but the RBS took that money due to historical debt with them, even though I had successfully completed an IVA in 2012. Out of the 46k pot the RBS took approximately 26k, a PPI company who was helping me took 10k and I got 10k. I then heard on the MSE you can claim back interest via HMRC. I did this to the best of my ability but I may have made a mistake. I have early onset Alzeirmers  and not used to dealing with HMRC so asked them to complete the filling of my form. They did this and seemed very helpful. I provided that with all the PPI payout letters to and suddenly I owe he tax man just under 4k!!!!!!!!! I am at my wits end and if I hat any hair left I would pull it out!!!!! Can anyone help me please, I am desperate!!!! 

The fact you completed an IVA doesn't mean the debt doesn't exist, just that you are no longer chased for it so RBS were perfectly within their rights to keep the money to offset the money you didn't pay them back originally. 10k for a PPI firm too - most expensive stamp you will ever pay for!

You should only declare the tax paid on the interest element of the PPI refund, I'd assume you probably declared 20k as interest on the form, hence the huge tax bill. You need to go back and check your numbers as you should only have tried to claim the tax back on the interest element. That said, if a big chunk of that refund was interest, perhaps you do owe it.

dunstonh

My overall pot was around k, but the RBS took that money due to historical debt with them, even though I had successfully completed an IVA in 2012. 

The rules allow the redress to be set off against unpaid arrears, defaults and amounts written off as part of a settlement.

 Out of the 46k pot the RBS took approximately 26k, a PPI company who was helping me took 10k and I got 10k

You should never use a claims company if you have defaults, arrears, IVAs etc.   Indeed, the claims company is meant to warn you that they bill against the full amount of the redress even if you don't receive it personally.  Did the claims company give you this warning? - if not, you could complain that they failed to adequately carry out their duties and fail to let you know the risks.

As mentioned above, HMRC should only be notified of the interest you were paid. Not the capital element.   Can you let us know the breakdown of your payment.  And let us know what income you are in receipt of.