£38M OF TAX OVERPAYMENTS REFUNDED

Have you overpaid on your pensions tax? HMRC has released information showing that £38million worth of repayments were issued to thousands of savers (aged 55 and over) in the final quarter of 2023. More than 12,000 reclaim forms were processed.

In the main, it was individuals accessing their pensions flexibly who were impacted. The unexpected tax bills have arisen due to an ’emergency’ tax code applied to their first withdrawal.

Analysis by investment broker AJ Bell indicated that since 2015, approximately £12 billion has been repaid to savers who were taxed too much. The average refund in the last quarter of 2023 amounted to £3,200, the same research stated.

There were calls in the national media, following the release of the information, for a tax system reform to accommodate flexible pension access, which has been available since April 2015, for those aged 55 or over.

HMRC told the FT newspaper that nobody overpays tax due to taking advantage of pension flexibility. It assured anyone affected by the emergency tax code issue they will receive an automatic repayment. HMRC officials added, individuals can also reclaim earlier for overpaid tax by filling out the appropriate forms.

Can we help?

Get in touch with Townends Accountants.


Tax Card 2023/2024

Get our handy Townends Tax Card today…

Menu