Tax Rebates & Refunds

Important things to know about UK tax refund

March 30, 2011
Posted in Income Tax — Written by Geoffrey

The income tax of most employees in the UK gets deducted automatically through the PAYE system. This system is specially set up to ensure that individuals receive a tax refund if they tend to make overpayments of taxes.

While not many people know, there are different ways one can be due to get a tax refund. You can claim tax back if you –

  • Worked for only half of the tax year
  • Only worked part time throughout the year
  • Had more than one job at a time

This may have resulted in one of the following two scenarios:

  • Earned less than the annual threshold value (£6475)
  • Had been paying excess NI contributions or emergency tax

If any of the above conditions are satisfied, you might be able to claim tax back from the HMRC.

How to determine an emergency tax code

If you have started a new job and not provided the correct documentation to your employer, you might be required to pay emergency tax rates. Ask your HR or the payroll department of the company about your tax code. You can even check your wage slip for more information. If you are paying an emergency tax, your payslip may display a code such as M1 or W1 at the end to represent when the emergency tax affects.

Tax returns for self employed individuals

Whether you work as a service provider or are self-employed, you can also claim the overpaid taxes back from the HMRC. Self employed individuals should get themselves registered with the HMRC and complete their self-assessment tax return.

If you believe that you have overpaid the taxes, you can use a tax refund calculator to determine the amount of tax refund you can get from the HMRC.

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