Claiming overpaid PAYE after retiring part way through tax year - impossible?

wadsRtight

I am trying to follow these steps to reclaim overpaid PAYE from the year I retired - was being taxed on assumed annual income but went down to a state pension part way through the tax year.

Steps:

(1) Visited this link: "https://www.tax.service.gov.uk/digital-forms/form/claim-tax-back-when-you-have-stopped-working/draft/guide"

Where it says:

Claim a tax refund when you've stopped working
To use this form you must be unemployed and not be currently receiving any:

- Jobseeker's Allowance
- taxable Incapacity Benefit
- Employment and Support Allowance
- Carer's Allowance

None of the above apply, I am only receiving state pension now.

(2) Clicked "Start Now" on the above page.

Where it says the below with 2 check boxes:

Current situation
What is your current situation?

- Not intending to work, claim benefits, draw a state pension or work pension before 5 April
OR
- Looking for work, or waiting to draw a pension

But I'm already drawing a state pension!

There is no correct box to tick - how is it that all searches lead me to this unusable method?

Woodstok2000

What year did you retire? What was your income from that year, and how much tax did you pay? How much do you think you are due back?

wadsRtight

Retired this Jan, estimated taxable income last year £56k, only tax code showing in my HMRC app is K44. The PAYE income tax summary in the app is showing "6 April 2026 to 5 April 2027", it shows that my previous employment has ended yet on the same page says "Your estimated income tax £15,300". And surely they mean for the above date range. That's more than my state pension! It's as if HMRC did not change my tax code, despite their system knowing the date I ceased employment and knowing I'm receiving state pension now.

I've seen mention online of having one's tax code corrected, but there's no process to begin doing this in the app. Trying to avoid 1 hour on the phone, wasting everyone's time.

eskbanker

Tax codes are only relevant if you have PAYE income, so if your only income in 2026/27 is state pension (plus savings maybe) then it doesn't matter what your code is, but if you have a private pension in payment then it does come into play for that…

Reclaiming any overpaid tax for 2025/26 is a different story but should happen automatically once they've run the numbers and issued your annual tax assessment within the next few months.

sheramber

The firm yiu are trying to complete is for current year of stopping working.

Your tax position for 25/26 will be assessed automatically later in the year.

Any tax overpaid will be refunded.

molerat

HMRC have a quirk of allocating a code to the last PAYE income stream you had, along with an estimated income and estimated tax deduction, when you no longer have any PAYE income. My SIL left her last job in 2021 and still has a code allocated to it. For every year since leaving her tax account shows "No PAYE Income Tax history for this year".

UKTaxHelper

The bit you want isnt in the app, its Check your Income Tax in the personal tax account on the website. You can tell it the old job has ended and edit the estimated pay yourself, and the code usually rebuilds within a few days without the phone call.

molerat

https://forums.moneysavingexpert.com/discussion/comment/82089939#Comment_82089939

The ended job doesn't appear in any sections that can be amended, it is purely in the summary categories. It is one of those HMRC quirks.

wadsRtight

Thanks I'll take another look. The nub of the issue is that HMRC's online help states you can initiate the refund online then leads you into a non functioning dead end. Links in my opening post.

IIRC the last time I had this, during a spell of unemployment 5 years ago, I had to spend tedious time on the phone then they expedited it. When checking online this time around, I'm led into believing it's available as an online process.

Doesn't HMRC realise that if straightforward things can be done online without phone calls, that saves HMRC's valuable resources for more weighty matters?

sherlock228

https://forums.moneysavingexpert.com/discussion/comment/82090175#Comment_82090175

but the state pension is taxable income so unless you have completed a tax return for the year the fact you received state pension between Jan - April 26 means you had untaxed income so a tax refund on your PAYE cannot be calculated until the tax owed on that pension is sorted.

I agree that on an ostensible income of £55k and with a K code, you would have been paying a lot of tax and so might be due a refund. But until your total for 25/26 is resolved then that is why it is a "dead end". Without a bottom line total any refund might end up having to be repaid anyway hence your inability to claim in isolation

wadsRtight

https://forums.moneysavingexpert.com/discussion/comment/82091107#Comment_82091107

Yes I'm ready and willing to complete any forms needed to assess my income up to this April 5th and thought I'd do it online. Dead end.