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Scottish Sun
3 days ago
- Business
- Scottish Sun
Millions of workers urged to look out for important HMRC letter which could lead to HUGE tax refund
Click to share on X/Twitter (Opens in new window) Click to share on Facebook (Opens in new window) MILLIONS of workers have been urged to look out for an important letter from HMRC which could lead to a huge tax refund. Between June and August, the tax office is sending out around four million P800 letters to inform people that they are owed an income tax refund. Sign up for Scottish Sun newsletter Sign up 1 Pensioners and workers on PAYE tax could be owed tax Credit: Getty Workers who pay PAYE tax and pensioners who may have overpaid their tax on pension income are among those who could receive the letters. There are several reasons you may have overpaid your tax, such as being put on the wrong tax code, starting to receive a pension at work, or receiving Employment and Support Allowance or Jobseekers' Allowance. You can reclaim any overpaid tax going back four years under the current time limits. Moneyfactscompare consumer expert Adam French has urged people not to ignore the P800 letters. "It can be easy to overlook but you shouldn't ignore it because it will let you know if you have paid the right amount of tax," he said. 'If you have changed jobs, worked multiple jobs or received benefits such as maternity or sick pay HMRC may have overestimated your tax bill, and it could owe you a refund. "On the flipside the letter may show you have underpaid tax due to a change in circumstances or a tax code error. "If you are owed a refund the letter should include details on how to claim it back, whereas if you owe HMRC money this is usually recovered by changing your tax code instead of demanding a lump sum payment there and then. 'The bottom line is that a P800 letter could mean unexpected windfall, or at least it can give you the chance to stay on top of your tax affairs. However, you won't know either way until you open the envelope.' An HMRC spokesperson said: "Customers should follow the straightforward instructions in the letter, which explain how to claim it online at or the HMRC app." What Does My Tax Code Mean? A Simple Guide to Your HMRC Letter If you receive a letter it will include a link to the Government's website where you can complete an online form to nominate the bank account you want your rebate paid into. It should then be around five working days until you receive your payment. In some cases if you don't complete the form HMRC will send a cheque, your letter will state if this is the case. You can also request to receive a cheque by email or phone, but this will mean you wait longer for the cash to hit your bank account - usually up to six weeks. If you've received a letter but don't have access to a computer or phone with internet, you can contact HMRC via phone or post. The phone number to call is 0300 200 3300 while any post should be addressed to: Pay As You Earn and Self Assessment HM Revenue and Customs BX9 1AS United Kingdom Remember, you don't have to wait for HMRC to contact you by post if you think you're owed a rebate. You can sign up for a Personal Tax Account and check if you are eligible for a repayment. You could get your payment earlier this way, rather than waiting for a letter through the door. If you've got a smartphone, you can track your tax via the HMRC app too. You should also be regularly checking your payslip to ensure you're on the right tax code, and having the right amount deducted. It's your responsibility to check and let HMRC know if it's wrong, otherwise you could end up paying out too much. Each tax code tells you how much you should be paying to HMRC every month. For example, the letter "L" on your tax code means you're entitled to the standard tax-free Personal Allowance. Meanwhile, "M" means you've received a transfer of 10% of your partner's Personal Allowance (£1,260). If you owe money to the taxman HMRC will collect it automatically over the following year if you are in employment, receive payments through a pension provider or owe less than £3,000. If this is not possible HMRC will write to you with details of how to pay off the funds due. Beware of scammers People are also being warned to beware of fraudsters impersonating HMRC to try and scam victims for money. urges people to make sure any communication they receive is genuine to protect themselves from scams. Its money editor Hannah McEwen says: "HMRC will always send a letter about any tax you're owed - it'll never text, email or call you unexpectedly and pressure you to take action." "If you're owed tax and HMRC says it'll send a cheque, you don't need to do anything," she adds. "It'll automatically send any cheque by post within 14 days of the date on your letter. If you're owed tax from more than one year, you'll get a single cheque for the entire amount." McEwen also warns people to be wary of following links in letters or messages, as they could be linked to scam sites. What is a tax code? You could end up overpaying or underpaying tax if you are put on the wrong tax code. Your tax code can be found on your payslip, your P60, or by contacting HMRC, and normally looks like some numbers followed by a letter. It's important to keep track of your tax code, as you can end up on the wrong one due to changing jobs or salaries and HMRC not being informed. The standard tax code is currently 1257L, meaning you can be paid £12,570 before tax is deducted. This code has been the same since the 2020/21 tax year, when the personal allowance was £12,500. How do I check my tax code? YOU can check your tax code on your personal tax account online, on any payslips or on the HMRC app. To log in, visit If you have one, you can also check it on a "Tax Code Notice" letter from HMRC. Bear in mind that you might need your Government Gateway ID and password to hand to log in. But if you don't have this you can use your National Insurance number or postcode and two of the following: A valid UK passport A UK photocard driving licence issued by the DVLA (or DVA in Northern Ireland) A payslip from the last three months or a P60 from your employer for the last tax year Details of a tax credit claim if you have made one Details from a self assessment tax return (in the last two years) if you made one Information held on your credit record if you have one (such as loans, credit cards or mortgages) Do you have a money problem that needs sorting? Get in touch by emailing money-sm@ Plus, you can join our Sun Money Chats and Tips Facebook group to share your tips and stories
The Sun
3 days ago
- Business
- The Sun
Millions of workers urged to look out for important HMRC letter which could lead to HUGE tax refund
MILLIONS of workers have been urged to look out for an important letter from HMRC which could lead to a huge tax refund. Between June and August, the tax office is sending out around four million P800 letters to inform people that they are owed an income tax refund. 1 Workers who pay PAYE tax and pensioners who may have overpaid their tax on pension income are among those who could receive the letters. There are several reasons you may have overpaid your tax, such as being put on the wrong tax code, starting to receive a pension at work, or receiving Employment and Support Allowance or Jobseekers' Allowance. You can reclaim any overpaid tax going back four years under the current time limits. Moneyfactscompare consumer expert Adam French has urged people not to ignore the P800 letters. "It can be easy to overlook but you shouldn't ignore it because it will let you know if you have paid the right amount of tax," he said. 'If you have changed jobs, worked multiple jobs or received benefits such as maternity or sick pay HMRC may have overestimated your tax bill, and it could owe you a refund. "On the flipside the letter may show you have underpaid tax due to a change in circumstances or a tax code error. "If you are owed a refund the letter should include details on how to claim it back, whereas if you owe HMRC money this is usually recovered by changing your tax code instead of demanding a lump sum payment there and then. 'The bottom line is that a P800 letter could mean unexpected windfall, or at least it can give you the chance to stay on top of your tax affairs. However, you won't know either way until you open the envelope.' An HMRC spokesperson said: "Customers should follow the straightforward instructions in the letter, which explain how to claim it online at or the HMRC app." What Does My Tax Code Mean? A Simple Guide to Your HMRC Letter If you receive a letter it will include a link to the Government's website where you can complete an online form to nominate the bank account you want your rebate paid into. It should then be around five working days until you receive your payment. In some cases if you don't complete the form HMRC will send a cheque, your letter will state if this is the case. You can also request to receive a cheque by email or phone, but this will mean you wait longer for the cash to hit your bank account - usually up to six weeks. If you've received a letter but don't have access to a computer or phone with internet, you can contact HMRC via phone or post. The phone number to call is 0300 200 3300 while any post should be addressed to: Pay As You Earn and Self Assessment HM Revenue and Customs BX9 1AS United Kingdom Remember, you don't have to wait for HMRC to contact you by post if you think you're owed a rebate. You can sign up for a Personal Tax Account and check if you are eligible for a repayment. You could get your payment earlier this way, rather than waiting for a letter through the door. If you've got a smartphone, you can track your tax via the HMRC app too. You should also be regularly checking your payslip to ensure you're on the right tax code, and having the right amount deducted. It's your responsibility to check and let HMRC know if it's wrong, otherwise you could end up paying out too much. Each tax code tells you how much you should be paying to HMRC every month. For example, the letter "L" on your tax code means you're entitled to the standard tax-free Personal Allowance. Meanwhile, "M" means you've received a transfer of 10% of your partner's Personal Allowance (£1,260). If you owe money to the taxman HMRC will collect it automatically over the following year if you are in employment, receive payments through a pension provider or owe less than £3,000. If this is not possible HMRC will write to you with details of how to pay off the funds due. Beware of scammers People are also being warned to beware of fraudsters impersonating HMRC to try and scam victims for money. urges people to make sure any communication they receive is genuine to protect themselves from scams. Its money editor Hannah McEwen says: "HMRC will always send a letter about any tax you're owed - it'll never text, email or call you unexpectedly and pressure you to take action." "If you're owed tax and HMRC says it'll send a cheque, you don't need to do anything," she adds. "It'll automatically send any cheque by post within 14 days of the date on your letter. If you're owed tax from more than one year, you'll get a single cheque for the entire amount." McEwen also warns people to be wary of following links in letters or messages, as they could be linked to scam sites. What is a tax code? You could end up overpaying or underpaying tax if you are put on the wrong tax code. Your tax code can be found on your payslip, your P60, or by contacting HMRC, and normally looks like some numbers followed by a letter. It's important to keep track of your tax code, as you can end up on the wrong one due to changing jobs or salaries and HMRC not being informed. The standard tax code is currently 1257L, meaning you can be paid £12,570 before tax is deducted. This code has been the same since the 2020/21 tax year, when the personal allowance was £12,500. How do I check my tax code? YOU can check your tax code on your personal tax account online, on any payslips or on the HMRC app. To log in, visit If you have one, you can also check it on a "Tax Code Notice" letter from HMRC. Bear in mind that you might need your Government Gateway ID and password to hand to log in. But if you don't have this you can use your National Insurance number or postcode and two of the following: A valid UK passport A UK photocard driving licence issued by the DVLA (or DVA in Northern Ireland) A payslip from the last three months or a P60 from your employer for the last tax year Details of a tax credit claim if you have made one Details from a self assessment tax return (in the last two years) if you made one Information held on your credit record if you have one (such as loans, credit cards or mortgages) Do you have a money problem that needs sorting? Get in touch by emailing money-sm@
Daily Mail
28-06-2025
- Business
- Daily Mail
Warning for higher rate taxpayers with more than £14,500 saved
Millions of higher rate taxpayers with more than £14,500 in savings could find themselves footing a shock tax bill. Record numbers of people have been pulled into the higher tax band, which means their tax-free savings allowance is slashed - and they will lose 40 per cent of interest above it to tax. The number of higher rate tax payers is set to balloon to more than 7million as thresholds remain frozen, figures from HMRC show. Half a million tax payers have been dragged into the 40 per cent tax bracket in the past year alone, and higher rate payers now account for almost a fifth of all tax payers. With the average easy-access account now paying 3.53 per cent, it means higher rate-taxpayers with more than around £14,500 in savings would breach their tax-free savings allowance this tax year, according to rates scrutineer Moneyfacts Compare. The personal savings allowance allows savers to earn up to £1,000 of interest tax-free. But this is only for basic rate taxpayers, higher rate tax payers see it halved to just £500 and additional rate tax payers have no tax-free allowance at all. > How the personal savings allowance and savings tax work HMRC expects to collect £6.1billion in tax on savings in the 2025/26 tax year. Of this around £1.3billion is expected to arrive from higher rate tax payers. Additional rate taxpayers, meanwhile, are expected to foot 70 per cent of the bill paid in savings tax at £4.2billion. Adam French, consumer expert at rates scrutineer Moneyfacts Compare says: 'The latest statistics from HMRC show how important it is for savers to be aware of their tax liability. 'Especially many of those who have fallen into paying the higher-rate tax of 40 per cent, whose personal savings allowance has been halved from £1,000 to £500 as a result.' How to beat the savings interest tax trap If you are keeping your savings in cash, an Isa will help you avoid a tax bill on the interest. An Isa is a tax-wrapper that allows you to salt away up to £20,000 in each tax year into savings or investments, with all returns then completely tax-free. Savers have cottoned on to this fact while interest rates have been high and the savings allowance threshold has been frozen, meaning Isas have had record amount of cash flooding into them. In April this year alone - the start of the new tax year - a record £14billion flooded into cash Isas. This was the highest figure for any month since Isas were introduced in 1999. And it does have an impact when it comes to taking the sting out of a tax bill, which can be seen in the latest HMRC figures. The nation's savings tax bill was dramatically lower last year than the Government had initially predicted. Last year HMRC forecast we would pay £10.4billion in tax on our savings in 2024-25, but this has now revised that down by a whopping £4.5billion to just shy of £6billion. Laura Suter, director of personal finance at AJ Bell said: 'This is likely down to two factors: interest rates not staying as high for as long as initially expected, and more people sheltering their savings from His Majesty's Revenue and Customs in tax-free Isas. 'We've seen record cash Isa usage in the past couple of years, as people are aware that they will be hit with tax on their savings.' Adam French added: 'Plenty of savers can avoid this tax bill by making use their yearly Isa allowances, with cash Isas keeping the savings of millions of people free from tax.' Five of the best cash Isas Products featured are independently selected by This is Money's specialist journalists. If you open an account using links which have an asterisk, This is Money will earn an affiliate commission. We do not allow this to affect our editorial independence. A cash Isa is an essential account for savers that protects you from tax on your interest. This means that your pot can grow without tax dragging it back - something that is especially important for the growing number of 40 per cent taxpayers. This is Money's savings experts scour the market for the real best cash Isa deals - looking for top rates and accounts that come without catches to trip you up. Below you can find a run down of our top deals and you can check all the best cash Isa rates in our savings tables. CMC Invest* easy-access - 5.44% (0.85% bonus for 3 months) - Facts: £1 to open, no limit on withdrawals, short bonus - Transfers in: Yes - Flexible: Yes Trading 212* - easy access - 4.92% with this link - Facts: £1 to open, no limit on withdrawals, 0.73% bonus for 12 months - Transfers in: Yes (but won't get bonus rate) - Flexible: Yes Chip easy access* - 5.00% (0.94% bonus rate for 3 months) - Facts: £1 to open, limited to three withdrawals a year, short bonus - Transfers in: Yes - Flexible: No Cynergy Bank one-year fix - 4.35% - Facts: £1,000 to open - Transfers in: Yes - Flexible: No Cynergy Bank two-year fix - 4.25% - Facts: £1,000 to open - Transfers in: Yes - Flexible: No
Yahoo
19-02-2025
- Business
- Yahoo
Millions with savings accounts risk losing £300 this year, expert warns
Millions of adults in the UK could be risking losing out on £300 following today's inflation announcement, a personal finance expert has warned. UK inflation jumped to its highest level for 10 months in January, according to new official figures. Plane fares, rising food costs and a sharp jump in private school fees all helped push inflation higher. The rate of Consumer Prices Index (CPI) inflation rose to 3% in January from 2.5% in December, the Office for National Statistics (ONS) said. Following the increase, new research from NerdWallet UK has found that as many as 42 million adults could be set to lose £300 this year. Adam French, consumer finance expert at NerdWallet UK, said: '. Following today's inflation announcement consumers must act quickly to move their money to the most competitive accounts to avoid inflation eroding their hard-earned wealth. 'There are several easy-access savings accounts available paying between 4% and 5% interest, such as Chip at 4.58% and Plum at 5.05%, plus the best regular savings accounts, into which you can save smaller amounts each month, are paying between 6% and 8%. 'Notably, First Direct is offering a fixed 7% rate for 12 months. Some of the best current accounts may also pay cashback on your spending or allow you to earn interest on your money. 'Taking 15 minutes to find a better bank account could leave you £100s better off. 'Our research found that the average UK adult is aiming to save around £10,000 this year which, following today's inflation figures, could be worth around £300 less by this time next year - in real terms. Grant Fitzner added: (Quote 2 of 2) 💬 — Office for National Statistics (ONS) (@ONS) February 19, 2025 'Instead, sticking those funds in one of the best savings accounts, which are currently paying almost 5% interest, could put £200 or more back in your pocket." On the rise in inflation figures, ONS chief economist Grant Fitzner said: 'Inflation increased sharply this month to its highest annual rate since March last year. 'The rise was driven by air fares not falling as much as we usually see at this time of year, partly impacted by the timing of flights over Christmas and New Year. This was the weakest January dip since 2020. 'After falling this time last year, the cost of food and non-alcoholic drinks increased, particularly meat, bread and cereals.' Rachel Reeves said her 'number one mission' was getting 'more pounds in pockets' after the rate of Consumer Prices Index inflation increased to 3% in January, according to the Office for National Statistics. The Chancellor said: 'Getting more money in people's pockets is my number one mission. Since the election we've seen year on year wages after inflation growing at their fastest rate – worth an extra £1,000 a year on average – but I know that millions of families are still struggling to make ends meet. 'That's why we're going further and faster to deliver economic growth. By taking on the blockers to get Britain building again, investing to rebuild our roads, rail and energy infrastructure and ripping up unnecessary regulation, we will kickstart growth, secure well-paid jobs and get more pounds in pockets.'
