Guide

UK tax refund - what to do, in order

If you may be owed a tax refund, the safest and cheapest route is almost always to claim direct from HMRC at gov.uk. This guide walks through when refunds happen, how to claim, and what to check before signing anything.

PayslipIQ provides educational information and estimated calculations only. It does not provide tax, legal, financial, payroll, accounting, pension, benefits or employment advice. Always verify your payslip, tax code, deductions and take-home pay with your employer's payroll department, HMRC, your pension provider, a qualified accountant, tax adviser or another appropriately qualified professional.

When refunds normally happen

A refund situation can arise where: you were on an emergency tax code for part of the year and HMRC has not yet reconciled; you were on the wrong tax code; you stopped work mid-year and your YTD allowance was not fully used; you paid tax on PPI interest above your savings allowance; or you have allowable employment expenses HMRC has not factored in.

Whether you are actually due a refund depends on your full year's circumstances. The free PayslipIQ checker can flag common warning signs, but the only authoritative answer comes from HMRC itself.

Step 1 - log into your HMRC personal tax account

Go to gov.uk/personal-tax-account and sign in or set up an account. This is free, official, and shows your year-to-date pay and tax direct from HMRC's records.

Step 2 - wait for the P800 reconciliation if applicable

After each tax year ends (5 April), HMRC compares total pay, total tax paid, and what should have been paid. If they do not match, HMRC normally writes to you with a P800 explaining the difference. If a refund is due, the letter explains how to claim it through your personal tax account.

P800 letters typically arrive between June and November after the tax year ends. If you have not had one by November and you suspect you should have, contact HMRC.

Step 3 - claim through your account

Refunds claimed through your personal tax account are normally paid directly to your bank within 5 to 10 working days. There is no fee. There is no third party between you and HMRC.

If you are still in a job and on the wrong tax code

If your tax code is wrong and you are still in the same job, you do not normally need to claim a refund as a separate step. Once HMRC issues a corrected cumulative code, your next payslip should show a smaller deduction (or even a negative deduction) that effectively refunds the overpayment.

What to watch for if you use a refund company

Tax refund companies act as agents and can charge between 25% and 50% of any refund obtained, plus VAT. Some require you to sign a deed of assignment; this can make HMRC pay the company, with the company then paying you the remainder.

Before signing anything, read the contract carefully and ask: what percentage do they take, do they require a deed of assignment, and how do you cancel. Many people who sign with a refund company could have claimed direct from HMRC at no cost.

HMRC's published guidance on agents and intermediaries is at gov.uk. Read it before signing anything.

Common warning signs your code may be wrong

Tax code letter changed mid-year without you knowing why.
Tax code with W1, M1 or X suffix has not corrected itself after 2 to 3 pay periods.
You started a new job mid-year and did not provide a P45; you have been on BR or 0T since.
You reduced hours mid-year but your YTD tax does not look proportionally smaller.
Your code includes a deduction for a benefit-in-kind you no longer receive.

None of these guarantee a refund. They are signals worth investigating through your HMRC personal tax account.

How PayslipIQ can help

The free payslip checker looks at the figures you provide and explains what each line should show given your stated tax code. It can flag inconsistencies that may suggest a code review is worth doing. It does not file refund claims; HMRC's personal tax account is the right place for that.