Tax Reclaim on Pay-Outs After 6th April 2016
If you were a non-taxpayer in the year the PPI was paid out, unless statutory interest pushes you over the tax-paying threshold, you can claim all of the tax back that you were taxed at the time.
Since April 6th 2016, the personal savings allowance is a further specific amount most taxpayers are allowed to earn tax-free just on savings interest:
Basic 20% rate taxpayers (earning £12,500-£50,000) can earn £1,000 in interest a year tax-free.
Higher 40% rate taxpayers (earning £50,000-£150,000) can earn £500 in interest a year tax-free.
Top 45% rate taxpayers (earning over £150,000) don’t get a personal savings allowance.
This is as well as the normal income-tax personal allowance.
Consumers would be due all tax paid back if the total interest is less than the personal savings allowance. Claims can be made up to four years back from the current tax year.