Thanks to Jimmy Carr and our friends over at Amazon, trying to get a little bit shaved off your taxes has gotten a bad rap. But away from dodgy offshore bank accounts and big corporation loopholes, there may be some legitimate reasons to ask the government for some of your money back - that's why we've put together this handy guide for those who might need to claim a tax refund.
Why would I need a refund?
Most of the time HMRC are pretty diligent about making sure they deduct the right amount of tax from your pay packet, so it's unlikely (although not unheard of) that you're going to be asking for a refund because of a government error.
Usually it will be because of some kind of misreporting at your end - for example that you paid tax in more than one country (which can be a common occurence among freelancers who divide their time between the UK and their adopted home overseas), or that you've left employment without notifying the relevant bodies.
How do I claim my refund?
Governments - particularly where tax is concerned - are often accused of excess and beauracracy, but the HMRC website is one that is surprisingly easy to navigate.
You can make your claim online at the gov.uk website, which requires you to submit all of your P60 data (your employer's PAYE number, your tax code, and so forth), along with the details of your circumstances and why you believe you might be entitled to a refund.
After that, there may be a significant waiting period, but you will eventually be contacted by the HMRC to let you know whether your claim has been a successful one. If it has, you'll either be asked to provide more information, or - fingers crossed - be compensated with any over-charge at a payment method of your choosing.
What if I'm self-employed?
Those who are self-employed are the most likely to claim a tax rebate because people under the spectre of the HMRC tend to be rather cautious, which can lead to over-payment. Many small business owners declare their accounts only to discover later they could have benefited from some loophole designed to encourage enterprise, or that they could have shaved off a few pounds through the cost of expenses.
If this sounds like you, you'll need to revise your self-assessment forms and re-submit them via the HMRC website. Needless to say, you won't be able to change the amount you have originally declared without good reason - so make sure your accounts are in order before you go making any claims.
If you are not sure that you can claim any overpaid tax by yourself, you can always get help from a company that specialises in tax refunds. You just have to supply them with your data and authorise them to do this for you. Of course, they will charge you so make sure that the taxes you are claiming back are a bigger amount than the fee that you will pay.
As you have probably noticed, the government aren't exactly in the habit of handing out freebies, so there are certain criteria you'll have to satisfy to make your application a successful one.
If you're recently unemployed and have began claiming some kind of means-tested benefits - be it jobseeker's, incapacity benefits or carer's allowance - you'll probably face a slight delay before you're given the opportunity to claim your refund. On the face of it, it seems rather harsh to keep money from those who need it most, but the underlying logic seems to be to ensure you have some funds to fall back on later on.
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