Tax Refund Query

bonnyrigger

I took an additional lunp sum out of my main pension (which I take a monthly payment from) in December 2025 which triggered a large tax charge. I submitted a P55 and have now got a new cumulative code for this pension. The HMRC letter said any adjustments would be via PAYE.

However I now have only 2 months left in the tax year, and Chatty says you can't get a refund which is more than the gross payment in any month. Will any outstanding refund still due after Feb and March be done via PAYE or will I need to contact HMRC again for the balance?

Thanks in advance.

Dazed_and_C0nfused

https://forums.moneysavingexpert.com/discussion/6654141/tax-refund-query

No idea what Chatty is but it doesn't know much about PAYE.

No idea why you would submit a P55 either in this situation.

Can you provide the total pension and tax deducted from your last pay(pension)slip. And the next pension payment that is due. And the date that will be paid. And the tax code in place for this pension.

Marcon

https://forums.moneysavingexpert.com/discussion/comment/81872863#Comment_81872863

Chatty is ChatGPT.

OP will have submitted a P55 to speed up resolution of the tax overpayment rather than waiting until the end of the tax year.

OP, how much do you expect the outstanding refund to be (roughly)?

Dazed_and_C0nfused

https://forums.moneysavingexpert.com/discussion/comment/81873028#Comment_81873028

But as the pension is still being paid HMRC won't be making a refund (during the year) it is resolved by ensuring the correct (cumulative) tax code is in place and the pension company making any refund that's due.

molerat

https://forums.moneysavingexpert.com/discussion/comment/81873028#Comment_81873028

But they had ongoing PAYE payments from that source so a P55 was not appropriate and would have been ignored apart from adjusting the tax code if necessary. The most likely problem here was that the tax codes in use were inappropriate for the income sources which had not been kept updated by the OP.

DRS1

OP I think Chatty is wrong. I had a refund of tax deducted back in 2024 and the next monthly payment was more than the gross amount of that month's pension payment. I thought they had paid me two months in one go by mistake but no it was the tax refund.

bonnyrigger

Thanks for the answers, I'll see what I get on 27th Feb. The overpaid tax was about 3.5k and I only take 1.4k a month from this pension normally.

If the P55 was wrong, what was the right way to get HMRC to issue a cumulative code?

Dazed_and_C0nfused

https://forums.moneysavingexpert.com/discussion/comment/81873108#Comment_81873108

It depends on the specific circumstances but a phone call would normally suffice. Or it can happen automatically.

But that is maybe less likely if you have a second pension in payment at the same time.

bonnyrigger

They changed my other pension code to SDOX in December and now it's back to SBR. My main tax code is now S1228L so hopefully all will be OK, I had wages up until the end of May which added another income source, next year will definitely be simpler.

I have one AJ Bell small pot SIPP which I'll be taking in full next FY, I presume a P55 will be the correct method to get the tax sorted on that one.

Dazed_and_C0nfused

https://forums.moneysavingexpert.com/discussion/comment/81873126#Comment_81873126

If you take it under the "small pots" rules there's unlikely to be any tax refund due.

If anything more likely you would owe extra (if it pushed you above the basic rate limit).

bonnyrigger

Thanks for all advice, I'll pop an update in once I get paid on 27th just to confirm how the provider has handled it.