How do I get this tax back?

Spendless

Beginning of 07 I got a letter about a pension for a company I used to work for. The pension scheme was in defecit and for this reason they wouldn't be payingthe full amount of pension when the time came but if I was interested in taking my pension elsewhere they'd pay me an amount (£2,000)for doing so.

I decided to do this and sent the forms off. A few weeks later I got a letter saying that rules had changed and I now needed to pay tax and NI on the £2000 and it would be deducted before it went into my bank account. This is what happened I received £1,500 but I am not a tax payer. I haven't worked for the past few years as I've been at home bringing up children. How can I get this tax back? I rang the tax office who sent me out a form which I returned,plus a while later the tax office sent me another form asking about any jobs I'd had since my last one, which was also returned, but nothing since. Do I need to ring/write again and should I wait till the new tax year?

System

It should take about 6 weeks from receipt of the last form you returned to get a response. If it's been more than that then call your tax office and ask what's happening.

GARDINER

I think this may be a refund of pension contributions on which you received tax relief on when you paid them. It follows that when the contributions are refunded the tax relief will be clawed back at a standard rate. If that is the case then it is not available for refund. Are you certtain that you paid nic's on the £2000? It's just that you paid 25% and that doesn't equate to tax and nic or to the rules shown at http://www.hmrc.gov.uk/manuals/rpsmmanual/RPSM04101090.htm

Spendless

I'm absolutely 100% positive I paid NI on it. I found the letter recently that gave a breakdown of what I got and the tax and NI deducted. I don't have the letter at hand at moment, but roughly from memory out of £2100 I paid about £500 tax and £100 NI.

It was only after they'd written saying that if I wanted to come out of scheme I would be paid just short of £2,100, that they sent another one saying rules had now changed and it was liable for tax and NI to be paid on it.