Income tax rebate

NedS

Hi all,

I am in employment with taxable income of around £8.6k in 2022/23

At the end of this tax year I will be taking a small pension under the 'Small Pots' rule, and as this is the first (and only) withdraw from this provider, they will have no tax code for me and income tax will be deducted. As a result, I will be due a tax rebate.

What are my options (claim via P53, do nothing and wait for HMRC to notice I've paid too much tax?), and how will the rebate be paid (cheque, direct to bank account, adjustment of tax code ??). I am not in a rush for the rebate and I would prefer to receive the rebate, by cheque or into back account if possible.

molerat

So you currently pay no tax ?

It depends on how close to the end of the tax year you are whether you can reclaim in year.  If you leave it up to HMRC they will refund via cheque or bank account.

xylophone

https://www.gov.uk/government/publications/income-tax-repayment-claim-when-small-pension-taken-as-a-lump-sum-p53#:~:text=Use form P55 to reclaim,pot, but not emptied it.&text=Use form P50Z if you,Support Allowance or Carer's Allowance.

Dazed_and_C0nfused

NedS said:

Hi all,

I am in employment with taxable income of around £8.6k in 2022/23

At the end of this tax year I will be taking a small pension under the 'Small Pots' rule, and as this is the first (and only) withdraw from this provider, they will have no tax code for me and income tax will be deducted. As a result, I will be due a tax rebate.

What are my options (claim via P53, do nothing and wait for HMRC to notice I've paid too much tax?), and how will the rebate be paid (cheque, direct to bank account, adjustment of tax code ??). I am not in a rush for the rebate and I would prefer to receive the rebate, by cheque or into back account if possible.

Apart from in very specific situations (not pension related) you can't get the tax refund for one tax year repaid via the tax code of a later tax year.

If you do nothing then when HMRC review the year they will send you a calculation and invite you to provide your bank account details so it can be paid into your account.  It's only if you ignore this that a cheque is issued.

https://www.gov.uk/tax-overpayments-and-underpayments/if-youre-due-a-refund

sheslookinhot

I recently received a tax rebate by cheque. No prior communication asking for bank details.

Dazed_and_C0nfused

sheslookinhot said:

I recently received a tax rebate by cheque. No prior communication asking for bank details.

There are some exceptions but bank transfer is the usual method.

https://www.gov.uk/hmrc-internal-manuals/paye-manual/paye91037

NedS

@molerat correct, I pay no tax as my taxable salary is around £8k after pension deductions (maxing out my work pension).

Thank you everyone. As I'll be taking the Small Pot right at the end of the tax year (March 2023), I doubt I'll have time to make a P53 application for an in year refund, so probably easiest to just wait a few weeks until the end of the tax year and deal with it then.

Assuming I take that route (rather than an in year P53), it would appear I can wait for a P800. Are there any other options - can I get the ball rolling by applying through my online tax account or similar after the tax year has ended or is it best to just wait for HMRC to do their stuff?