New Process for Tax Repayments

Post Author:

Anne Melville

Date Posted:

October 14, 2024

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Personal Tax

At the end of each tax year, HMRC send taxpayers, who are not within self-assessment, an ‘End of Year Tax Calculation – P800’ if they have underpaid or overpaid their taxes. This personalised letter indicates:

  • whether the recipient needs to pay more tax or is eligible for a refund;
  • the amount involved; and
  • how the payment or refund will be made.

It also provides a more detailed breakdown of the tax calculations, to help the taxpayer understand how HMRC has arrived at the figures. Taxpayers are asked to contact HMRC if they think there is an error.

Following a change of policy, taxpayers must now usually take action to claim P800 PAYE repayments; the option to wait 21 days for a cheque to be issued automatically has been removed. However, these changes do not yet apply to all P800 repayments. Some taxpayers will continue to receive P800s with a message to say that a cheque will be issued if the repayment is not claimed within 21 days. This includes repayments where multiple tax years or claims by agents are involved.

However, most taxpayers will receive a P800 with instructions that the new process must be followed, with the repayment claimed online. You can request a cheque to be sent by post or arrange a transfer into your bank account.

Note that there is:

  • no requirement to set up government gateway credentials for this service; and
  • no opportunity to nominate the repayment to a third party.

All that is needed is the P800 reference number and your National Insurance number.

A cheque will only be sent to the taxpayer’s address on HMRC’s records. If that address is not correct, the taxpayer will need to change the address by

  • phoning HMRC; or
  • using the online change of address service (which is behind sign in credentials).

If the bank transfer option is chosen, you will need to have your banking app installed on the device you are using, as you will be transferred to sign in to your bank account as part of the process.

If you are confused by these new rules, or have any other concerns, we can help you claim any tax repayment due to you.

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