UK Income Tax Refunds

How do you qualify for a UK Income Tax repayment claim and how far back can you claim?

There are various ways that you can be entitled to a UK Income Tax refund.

These refunds can arise from income that comes from a variety of sources. For example income that is under PAYE (Pay as you Earn) where tax is deducted at source or perhaps where you have income paid under the CIS (Construction Industry Scheme) deduction system.

Under PAYE earnings you may be able to claim some business expenses depending on the actual work that you do. One example could be a mobile Home Carer where a motor vehicle is used to carry out the duties in order to be able to visit clients. If mileage expenses have not been reimbursed by your employer it may be able to make a claim for them and indeed go back over previous years up to a maximum of six tax years.

Another example could be a Motor Mechanic who provides his own tools as is very common in that trade. Another way that a UK tax refund will become due is

that if you leave the UK and have no intention to return and take up PAYE employment before the next April the 5th (the end of the tax year). You will very probably be entitled to claim a UK Tax refund as you will not have used up all your personal allowances.

If you have already left the UK you can appoint an agent to claim the refund on your behalf and remit the money to you any where in the world. Even if you are still in the UK but are planning to leave shortly it is still worth appointing a Tax Agent as they know the ropes and can often speed things up on you behalf.

Yet another way that you may qualify for a refund could be that you started a PAYE employment part or mid way through a tax year where you may then have been taxed on a month 1 basis.

This can often happen when people work for the first time perhaps when they first come to the UK. Where a PAYE code has been issued as a month or week 1 basis it means that the tax free part of the pay is calculated only on each monthly or weekly monthly payroll and not on an accumulative basis.

So if you started six months into the Tax Year and had a month 1 code then at the end of the tax year you would only have been able to use one half of the personal allowances so you would have unused allowances that would give rise to a refund.

A normal Tax code which is not a week or month 1 basis will allow the free pay to accumulate evenly over the tax year so that the Tax due would be calculated correctly and in those circumstances there would be no refund due. More often than not a week or month 1 coding will mean that an income tax refund may be due.

If you are due a refund it is possible to claim for the last six tax years.

For how many previous years can you claim a refund for ? If you are due a refund it is possible to claim for the last six tax years. The British tax year runs from the 6th April to the 5th April in each year.

This six years is not that straightforward,in my view, as if you have overpaid tax it must be claimed back no later than the 31 January five years after the end of the tax year (5 April) in which the overpayment was made.

So if you are due a refund for the tax year ended 2004/5 which ended on 5 April 2005 the claim needs to be made by 31 January 2011. So in real terms the time limit is 3 months less than six years. As that advert says "Tax does not have to be taxing" it is just confusing and full of very confusing language.

What documentation do you need to provide so that your UK Tax agent can process your refund?

You will need to provide an original P45 for each employment that you have held and these would normally be given to you at the cessation of each employment if you left before the 31st March in each year.

The Form P60 from your employer that you were working for at the end of the tax year effectively 31st March.

If you can not find or have lost any of these original documents then yiur tax agent may be able to get a letter or statement of the earnings from your previous employer. This together with a detailed schedule of the dates you started and left with details of your gross income.

UK Income tax can be taxing and complex so it is a good idea to use an agent to get you what you are due.

About The Author The Author writes many articles on Income Tax and for more information please go to Income Tax Refunds