Why use this service?
PPI pay-outs are made up of the compensation (which is the refund of the PPI premiums paid and the interest you have paid on those premiums) and the statutory interest on the compensation, at 8% (paid in recognition that you were deprived of your money for some time).
It is only the second element, the statutory interest, which is taxable (in the tax year that you receive it). Your circumstances in the tax year(s) in which you paid the original premiums are not relevant.
Although the statutory interest element is treated for tax purposes as savings income, it is not paid gross like bank interest. Most of the time, basic rate tax is deducted at source on the interest element of a PPI pay-out before it is paid to you. The tax is then passed to HMRC on your behalf.
But you may not ultimately be liable to pay tax on the PPI interest element, for example, if when combined with your other savings income for the year, the total is within your Personal Savings Allowance, or if your total taxable income for the year is within your tax-free personal allowance – £12,500 in 2020/21. If this is the case, it is possible to claim back the tax which has been deducted at source.
We handle the whole process for you end to end.
All you have to do is complete our simple online application form and we will do the rest. To request your application form please email: firstname.lastname@example.org
You normally have four years from the end of the tax year in which the overpayment arose to claim a refund. So, if you received your PPI refund in 2020/21, you have until 5 April 2025 to submit a claim. If the overpayment arose in 2016/17, you have until 5 April 2021 to put in your claim and so on.
On the 6th April 2016, the Government introduced the personal savings allowance, which gives most taxpayers a tax free savings allowance of £1000 per annum. The statutory interest element of a successful claim is included in this allowance, meaning this can be claimed back from HMRC.
The personal savings allowance was introduced in April 2016. A claim can be made for any case settled after that date. You have four years after the end of the tax year in which the case was settled to make a claim.
You will not be able to make a claim for any case which was settled before April 6th 2016.
Basic rate (20%) tax payers have an annual allowance of £1000
Higher rate (40%) tax payers have an annual allowance of £500
The highest rate (45%) tax payers have no annual allowance
Non tax payers should be able to reclaim all the tax they have paid on the statutory interest element of their claim
The value of a claim for repayment of tax varies according to a number of different factors. It is not necessarily directly linked to the value of the original PPI claim. However, the average successful claim value for this type of case is currently around £250