Tax Refunds and Overpayments

Millions of people overpay tax every year — often without knowing it. A wrong tax code, an emergency code on a new job, two jobs at once, or leaving work halfway through the year can all mean too much tax was taken. The good news is that overpaid tax can be claimed back, usually quickly and online. This guide explains why overpayments happen, how HMRC tells you, how to claim, and how far back you can go — and how to spot the scams that pretend to be HMRC.

Why overpayments happen

The most common cause is a wrong tax code. If your code gives you too little tax-free pay, too much tax is deducted every payday. Emergency codes on a new job are another common cause: the code taxes each payday on its own, without using your year-to-date pay, so a large first month can be over-taxed. Having two jobs can also cause overpayments, because each employer applies the thresholds separately.

Leaving work part-way through the year is another classic case: PAYE assumes you will earn the same amount all year, so if you stop in October, the tax taken in the earlier months was worked out on a full year’s income that you never earned. The same can happen with a pension that starts mid-year, or with savings interest that was taxed when it should not have been.

The P800 tax calculation

After the tax year ends on 5 April, HMRC reconciles the PAYE records for all employees. If its figures show you overpaid or underpaid, it sends a P800 tax calculation — usually between June and November after the tax year ends. The P800 shows HMRC’s view of your income and the tax paid, and what it thinks you are owed or owe.

If the P800 shows a refund, you usually need to claim it actively — HMRC stopped automatically issuing most refunds in May 2024. The P800 tells you how: online through your Personal Tax Account, or by phone. Check the figures on the P800 against your own P60 and payslips before you claim, because HMRC’s records are sometimes wrong — a missing job or a wrong benefit can change the result.

How to claim

The fastest way is through your Personal Tax Account on GOV.UK. Sign in with your Government Gateway ID, go to "Check your Income Tax", and if HMRC’s records show an overpayment you can claim it directly to your bank account — typically within about 5 working days. You will need your National Insurance number and your bank details.

There are other routes for other situations. If you stopped working and do not expect to work again before the end of the tax year, and you have been unemployed for at least 4 weeks, you can claim in-year using form P50. If you overpaid tax on savings interest or pension withdrawals, form R40 is the route. If you file a Self Assessment return, any overpayment is worked out automatically when you file, and you can ask for it to be refunded or left as a credit against next year’s bill.

How far back can you claim?

You can claim overpaid Income Tax for up to 4 tax years back. For each year, you will need your P60 — the end-of-year summary from your employer — or your P45 from a former employer. Claims for older years are generally time-barred, unless HMRC made an administrative error, in which case you should contact them directly.

National Insurance overpayments have different limits: there is no time limit if you worked two jobs, or were both employed and self-employed, but usually a six-year limit for other reasons. If you think you overpaid National Insurance — for example, because you had two jobs and both employers deducted it on the full thresholds — check GOV.UK’s guidance on National Insurance refunds, and note that HMRC now writes to some people it identifies as having overpaid.

Watch out for scams

HMRC will never contact you about a refund by text, WhatsApp, or social media, and will never ask you to click a link in an email or text to claim money. Genuine HMRC refund notifications will not ask you to click on links. If you get a message claiming to be HMRC offering a refund, do not click anything — go directly to GOV.UK and sign in to your Personal Tax Account yourself.

The same warning applies to phone calls: HMRC will not phone you out of the blue demanding payment or offering a refund, and it will never ask for your bank details by text. If you are unsure whether a contact is genuine, end the call and phone HMRC yourself on a number from GOV.UK — the Income Tax helpline is 0300 200 3300.

Sources: GOV.UK, Check if you paid too much tax; GOV.UK, Claim a tax refund; GOV.UK, Personal Tax Account; GOV.UK, Repayments and refunds from HMRC.