Top Reasons You Might Be Owed A Tax Refund
Paying your tax is supposed to be simple. For most people, it’s handled automatically through the Pay As You Earn (PAYE) scheme. For others, many of them self-employed, the Self Assessment tax return system is how they report their earnings and expenses. Either way, HMRC crunches the numbers and works out how much tax you owe. After that, the money’s either taken from your pay before you get it or you settle up yourself.
The trouble is, the taxman’s calculations are only as reliable as the information he’s working with. A lot of the time, HMRC won’t have a complete and accurate picture of your work and financial situation. When that happens, it’s easy to end up paying the wrong amount of tax without realising it – often for years at a time! Many millions of pounds in overpaid tax find their way into HMRC’s pockets every year, and it’s not always an easy matter to get that money back where it belongs.
Here’s a quick run-down of the main reasons UK taxpayers find themselves owed a tax refund, along with some pointers on what to do about it.