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How do I get a tax rebate?

As a taxpayer in the UK, you may be entitled to claim tax back if you have paid too much tax or if you have not used all of your tax-free allowance. This guide will provide you with a step-by-step process to help you claim your tax back in the UK.

Introduction to Claiming Tax Back in the UK

It is possible for individuals to pay more tax than they owe, which can be due to various reasons such as errors in the tax code or overpayment in the previous tax year. In such cases, you can claim back the excess tax paid, and this process is known as claiming tax back.

Understanding Tax Codes and Refunds

Before claiming tax back, it is essential to understand how the UK tax system works. The tax code is a series of numbers and letters that are used to calculate how much tax you should pay under PAYE. The code is based on your personal allowance, which is the amount of money you can earn tax-free in a tax year. If you have paid too much tax, you will receive a tax refund, which is the excess amount paid to the government.

Who is Eligible to Claim Tax Back?

If you have overpaid your tax, you will be entitled to claim a refund. You may also be eligible for a tax refund if you have not used all of your tax-free allowance. Some of the common reasons why you may be eligible to claim tax back include:

  • You are employed in the UK and have paid tax through PAYE
  • You have stopped working and have not used all of your tax-free allowance.
  • You have paid tax on your savings interest.
  • You have paid tax on your pension income.
  • You have made charitable donations through Gift Aid.
  • You are in a ‘tax relief at source’ pension scheme and your are a higher rate taxpayer.
  • You are self-employed or have other income and you have made overpayments on your ‘payments on account’ during the year.

How to Check if You are Due a Tax Refund

To check if you are due a tax refund, you need to review your tax records and check your tax code. You can do this by:

  • Reviewing your payslips: Check your payslips to see if you have been paying the correct amount of tax if you are employed. If you have been overpaying, you will see a higher tax deduction than what you should have paid.
  • Using an online tax calculator: You can use an online tax calculator to calculate how much tax you should have paid. This will help you determine if you have overpaid your tax.
  • Checking your P60: Your P60 is a summary of your pay and the tax you have paid in the tax year if you are employed. You can use this document to check if you have overpaid your tax.
  • Contacting HMRC: You can contact HMRC to check if you are due a tax refund. You will need to provide your National Insurance number and other personal information.
  • Logon to your HMRC personal tax account to see if any refund is due.
  • Use tax software to calculate your tax to see if you have overpaid.
  • Let an accountant check whether you have overpaid.

How to Claim Tax Back Online

Claiming tax back online is the easiest and fastest way to receive your tax refund. You can claim tax back online by following these steps:

  1. Visit the HMRC website and log in to your account or create a new one.
  2. Select the option to claim a tax refund.
  3. Follow the instructions and provide the necessary information, such as your employment details, income, and tax paid.
  4. Submit your claim and wait for HMRC to process your application.

How to Claim Tax Back by Post

If you prefer to claim tax back by post, you will need to complete a tax refund form and mail it to HMRC. Here are the steps to claim tax back by post:

  1. Download and print the tax refund form from the HMRC website.
  2. Fill in the form with the necessary information, such as your employment details, income, and tax paid.
  3. Attach any supporting documents, such as payslips or P60.
  4. Mail the form to the address provided on the form.

What Documents Do You Need to Claim Tax Back?

When claiming tax back, you will need to provide certain documents to support your claim. These documents may include:

  • P60: This document shows your earnings and tax paid during the tax year.
  • P45: If you have stopped working during the tax year, you will need to provide your P45.
  • Payslips: You may need to provide payslips to support your claim if you have not received a P60 or P45.
  • Bank statements: If you have paid tax on savings interest, you may need to provide bank statements to support your claim.
  • If you have overpaid ‘payments on account’ this can be seen on your online account.

How Long Does it Take to Receive a Tax Refund?

The time it takes to receive a tax refund depends on the method of claim and HMRC processing times. If you claim tax back online, you can expect to receive your refund within five working days. If you claim tax back by post, it can take up to six weeks to receive your refund.

Tips for Maximizing Your Tax Refund

To maximize your tax refund, you should:

  • Keep accurate records of your income and expenses.
  • Claim all the tax reliefs and allowances that you are entitled to.
  • Make charitable donations through Gift Aid.
  • Keep track of your tax code and ensure that it is correct.

Common Mistakes to Avoid When Claiming Tax Back

When claiming tax back, there are common mistakes that you should avoid. These mistakes include:

  • Failing to claim all the tax reliefs and allowances that you are entitled to.
  • Failing to keep accurate records of your income and expenses.
  • Using incorrect figures when completing the tax refund form.
  • Failing to claim tax back within the deadline.

 

Disclaimer: Paul Stankiewicz is the owner and principal at Paul Marks & Co Chartered Accountants which is the trading name of Paul Marks Ltd a Limited Company registered in England and Wales (registered number 4487645).This article is designed for the information of readers only and is the opinion of the author only. Readers should not act on any of the information contained in this article without seeking professional advice. Nothing in this article constitutes advice, nor does the transmission, downloading or sending of any information or the Material create any contractual relationship. Links to third party websites are provided as a convenience to the reader, Paul Marks Ltd does not control and is not responsible for any of those websites or their content. Paul Stankiewicz and Paul Marks Ltd accepts no liability or responsibility whatsoever for any loss or damage suffered by any user of the information contained on or accessed through this article or the Material downloaded.