Bank refund 3 August 2022 at 8:54AM in Reclaim PPI & other insurance 3 replies 124 views

byek

Hi I’ve had a refund from hsbc for an investment account I was sold wrongly and lost £10,000 via a third party. They took 40% of my money they got back for me and was tax on all of the amount I was given. Even the £10,000. The company have said I can make another claim for them to get this money back with the same charges. Is this really correct?

[Deleted User]

Possibly, depending on whether you were under the tax threshold, but for for heaven's sake, stop paying companies to post letters for you!

If you believe you should not have paid tax on the interest part of the amount, you can reclaim it via HMRC.  If you paid too little tax, it will tell you how much more you need to pay.

https://blog.moneysavingexpert.com/2019/04/martin-lewis--had-a-ppi-payout---if-so-you-can-reclaim-the-tax-o/

[Deleted User]

Make sure the leaches don't have any sort of deed of assignment or agreement to act on your behalf to claim tax or you'll find they start chasing refunds every year from HMRC and taking a cut

dunstonh

They took 40% of my money

Ruddy hell.    They took you to the cleaners there.    All it took them was a quick email to the bank asking them to investigate the sale of the investment and its suitability.   Literally just that.  Indeed, some CMCs just email a spreadsheet with name, address, NI number, account number (if known), and a cover email telling the bank they think it was missold and to investigate.  It's just 2 minutes' work.

 and was tax on all of the amount I was given.

The CMC fee is subject to VAT and not reclaimable.
The interest amount on the redress is taxable at source but can be fully or partially reclaimed from HMRC if it is within your personal savings allowance (£1000 for most people but £500 for higher rate).

The CMC will charge you again for reclaiming it and some unscrupulous ones get themselves named as agents and will take a cut of any future HMRC rebate you may get.   

You only need to notify HMRC yourself of the interest amount you have been paid in this tax year and they will rebate you directly.

Remember that it is only the interest part of the redress.  Not the capital part.