Millions of letters have beenb send out and the BBC finance guru said ‘they’re genuine’
A BBC expert has explained how millions of people could be due hundreds of pounds back from HM Revenue and Customs. BBC Radio 4 Money Box Journalist, Dan Whitworth spoke out on BBC Morning Live and explained that about four million letters have been send out by HMRC so far this year.
The P800 letters go out to people who are owed tax and the government organisation has said that the average claim is a decent £473. Mr Whitworth said: “These are known as P800 letters. They are sent when HMRC believes you’ve overpaid tax, often due to changes in your employment or circumstances that haven’t been reflected immediately in your tax code.”
He explained that common reasons people overpay tax include:
- Having more than one job in a tax year.
- Changing jobs and your new employer not getting your details in time.
- Stopping work part way through the year.
- Having savings interest or certain benefits taxed incorrectly.
Mr Whitworth said: “If you get one of these letters, the advice is simple: check it carefully. You can log in to your personal tax account or the HMRC app to confirm the refund and have it paid directly into your bank. For those unable to use online services, you can contact HMRC by phone on 0300 200 3300 or by post to Pay As You Earn and Self Assessment, HM Revenue and Customs, BX9 1AS
“These letters are genuine and could mean you are owed hundreds of pounds.”
A spokesperson for HMRC told BBC Morning Live: “We wrote to around 4 million customers this summer to inform them they are due a refund, and need to claim it. Customers can follow the straightforward instructions in the letter, which explain how they can quickly and easily claim it online on GOV.UK or via the HMRC app.”
The letter it is referring to is the P800 Tax Calculation. These are issued to people who HMRC who have either paid too much or too little tax. It outlines exactly what went wrong in your tax calculation and how to fix it either by claiming your overpaid tax back from HMRC or paying the rest of your tax bill.
Instructions on how to do this are usually provided in the letter and can be found on the Gov.uk website. The letter might otherwise say HMRC is sending you a cheque, in which case you will not need to contact the department to claim your refund as you should automatically get the cheque within 14 days of the date on your letter.
Earlier this summer, HMRC noted that almost one million people had not yet claimed their tax refund. Around four million P800 were expected to be sent out this summer, with the final remaining letters expected to be delivered by November 30, 2025.
Only people who are employed or receive a pension will get these letters. Anyone else who is registered for Self Assessment tax returns will have their tax bill automatically adjusted.
Tax refunds can be worth thousands, and these claims can also be backdated by up to four years, so people who received P800 letters as far back as 2021 might still be able to claim their cash.
As P800 letters continue to arrive on doorsteps, experts have also issued warnings about scammers taking advantage of the situation. Money-Saving Expert noted that fraudsters may try to impersonate HMRC and offer these refunds via text, email, or phone call.
However, this is also the biggest giveaway that it could be a scam as HMRC will always contact taxpayers via post if they are owed a tax refund, not online although the claim process can be done digitally. HMRC will also never ask you to make a payment or randomly get in touch to confirm banking details.
The Gov.uk website has an online checker tool where people can check if they have been owed a tax refund in previous years. Most tax refunds occur because people have paid too much income tax due to complications during the tax year like changing jobs or having multiple income streams.
This can include paying too much tax on pension, income from a job, redundancy payments, UK income for people living abroad, foreign income for people living in the UK and interest from savings or payment protection insurance. One of the most common reasons for paying the incorrect amount of tax is having the wrong tax code.
Each person is assigned a tax code by HMRC which is based on their earnings and dictates their personal allowance. This allowance is the amount that you can earn each year before becoming liable for income tax.
1257L is the most common code and covers people with a single income from work or a person. It represents that their personal allowance is £12,570.
Tax codes with ‘W1’, ‘M1’, or ‘X’ are emergency tax codes and can be given to you if you’ve changed jobs or have moved from being self-employed to working for an employer. These tax codes are temporary but it does affect how much tax you pay while it is in use.
