Claim Tax Rebate from HMRC

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Updated on : 10-Dec-2024   06:48 PM GMT | 4 min read

Claim a Tax Refund

The only situation in which you are eligible for claiming refund is when you overpaid the tax to HMRC. You are eligible to claim refund from HMRC if you paid too much tax on –

1. Pay from your current or previous job
2. Income from life or pension annuity
3. Pension payments
4. Income from savings or PPI
5. Self-Assessment Tax Return
6. Redundancy payment
7. Cost of fuel or work clothing for your job
8. UK income if you live abroad
9. Foreign income

Disagree with a Tax Decision

In case you are having any query about the tax decision taken by HMRC, contact HMRC but if you are unable to understand the decision, get professional help from FinacBooks.

HMRC sends you a decision letter which tells you whether you can appeal against the tax decision or not. You cannot appeal against each & every decision taken by HMRC. Some of the decisions in which you can appeal against HMRC are as follows –

1. Your Tax bill (Self-Assessment Tax, Corporation Tax, VAT)
2. Tax Relief Claim
3. Information request or checking of your business records
4. A penalty (in case tax is filed or paid late)

The appeal can only be made by the person who is dealing with your taxes such as an accountant. In case you appeal against the tax decision, generally you have to pay the cost on your own but you can delay the payment of a penalty until the final decision has been taken on your appeal.

If HMRC did not act on information

HMRC needs to act on the information provided by you and your employer or the department for work & pensions. In case HMRC did not act on the information provided, you may ask HMRC to cancel the owed tax. You can do this if you owe -

1. Income Tax
2. Capital Gains Tax
3. Class 4 national insurance

Appeal against a Tax Decision

How to Appeal against a Tax Decision?

You can appeal against a tax decision by –

• Using the appeal form you receive along with your decision letter

• Write to HMRC on the address mentioned on the letter. Generally, you have 30 day’s time to appeal against the decision. You must provide –

  • Your name or business name
  • Your tax reference number mentioned on the decision letter
  • Your signature
  • What are the correct figures according to you and how you have calculated them
  • What you disagree with & why

In case you think that HMRC has missed something or you want to add any extra information, you must provide that information to HMRC within time

In case you are not having a decision letter, the other option is that you can write a letter to HMRC in relation to your return.

In case you want to appeal against HMRC decision in relation to Indirect tax (VAT, excise duty, customs duty), you can do so by the following –

1. Request a review from HMRC
2. Appeal straight to the tax tribunal

If your things are seized by customs because of not paying duty or VAT, you can ask for your things back after paying the required amount of duty or VAT.

What happens next?

In case of indirect tax, when you appeal against HMRC decision, you can accept or request for HMRC’s review. The review decision is carried out by someone who was not involved in the process of original decision. The review decision normally takes 45 days but if it extends to a longer period, HMRC will contact and tells you about the same.

In case you disagree with HMRC’S review

1. You can appeal against HMRC’s decision by contacting tax tribunal and ask them to hear your appeal. You must contact tax tribunal within 30 days of the review decision.
2. Take into consideration alternative dispute resolution (ADR)

Appeal against a Penalty

You are also having the option to appeal against penalty imposed by HMRC because of the following reasons –

1. Sending tax return late
2. Filing of inaccurate tax return
3. Late tax payment
4. Non-maintenance of adequate records

In this case too, an HMRC officer who was not previously involved in the penalty decision will be the decision authority.

In case you want to appeal against the penalty imposed by HMRC in relation to indirect tax, you can do so by the following –

1. Request a review from HMRC
2. Appeal straight to the tax tribunal

If you are having a reasonable excuse, your penalty amount may be cancelled or amended by HMRC.

How to Appeal Against a Penalty?

In case you received a penalty letter from HMRC by post, use that appeal form comes along with it or just follow the instructions mentioned on the letter whereas in case of self-assessment, PAYE, VAT and corporation tax, you need to use extra documents or there are many alternate ways to appeal .

In Case You Are Appealing a Self-Assessment Penalty

A penalty of £100 imposed by HMRC in case of late tax return filing. Before making appeal against the penalty, you need to send your tax return or ask HMRC that is there any need to complete the same. You can tell this to HMRC via online or calling helpline.

In order to appeal against the penalty, you need the following information –

1. Date of filing self-assessment tax return
2. Date on which the penalty was issued
3. Reasonable excuse for late filing of tax return

You can easily apply against a penalty online but you need to set up a government gateway account (if you are not having the same)

If you don’t want to appeal online, you can also appeal –

• By post using form SA 370
• By letter

Send your return or letter to HMRC’s address for self-assessment enquiries.

In case of partnership firm, only the nominated partner can appeal against the penalty imposed by HMRC with the help of form SA 371.

If You Are Employer Appealing a PAYE Penalty

You can appeal online only in case you are registered for HMRC’s PAYE for employer service. After registering and logging in, choose “Appeal a penalty”, immediate acknowledgement has been provided when you submit your appeal online.

In Case You Filed a Late VAT or Corporation Tax Return

There are specific forms which you can use for –

1. VAT (if you are having a reasonable excuse for filing return late)
2. Corporation tax (If you filed late return due to computer problem)

In Case you are not having an Appeal Form

In absence of appeal form, you can send a signed letter to HMRC which must include the following information –

1. Your name
2. Your reference number. For ex – VAT registration number or self-assessment unique tax payer reference number
3. Reason why your tax return or payment was late including dates

In case you are not able to file the return or pay the amount due to computer problem, you must include the date you tried filing the return or making the payment online along with the system error message.

Deadlines to make appeal against the Penalty Notice

You need to make appeal against the penalty notice within 30 days of the appeal. In case you miss the deadline, you need to explain the reason for your delay and if the excuse is considered reasonable by HMRC, they may accept it and taker the decision in your favour.

If you disagree with HMRC’s review

1. You can appeal against HMRC’s decision by contacting tax tribunal and ask them to hear your appeal. You must contact tax tribunal within 30 days of the review decision.
2. Take into consideration alternative dispute resolution (ADR)

Delay Payment of Tax Bill While Appealing

In case you disagree with the penalty amount, you may delay paying of tax bill or a penalty.

Made an appeal against HMRC in relation to Direct Tax Decision

In case you made an appeal against HMRC in relation to direct tax decision (Income tax, capital gains tax or corporation tax), write to HMRC and tell them –

1. Why you think the amount you are asking me to pay is too much.
2. What you think is the correct amount and when I have to pay it.

If they agree, HMRC will response you in writing.

Direct Tax Decision Appeal against a penalty

When you appeal against a penalty, you don’t have to pay unless and until your appeal has been settled.

Made an appeal against HMRC in relation to Indirect Tax Decision

In case you asked HMRC to review an indirect tax decision (Insurance premium tax or VAT), there is no need to pay tax until the review has been finalized by HMRC.

In case you appeal against the penalty to the tax tribunal, you need to pay the tax before they will hear your appeal.

You can only delay the tax payment, if it causing you extreme financial liability. For ex – Bankruptcy or Liquidation.

Once the decision has been taken by the tax tribunal, you must pay the owed money along with the interest.

Indirect Tax Decision Appeal against a Penalty

In case you asked for the review or appealed against the penalty to the tax tribunal, HMRC will not ask you for the payment until your appeal have been settled.

Reasonable Excuses to Appeal against HMRC Penalty

If you are having a reasonable excuse for filing late return or making late payment, you can easily appeal against the penalty.

What may count as a Reasonable Excuse

The excuses considered reasonable by HMRC are as follows –

1. Death of your partner or close relative before the tax return or payment deadline
2. In case you are suffering from serious or life threatening illness.
3. Unexpected stay in hospital
4. Computer issue or software issue before or while preparing the return.
5. Fire, flood or theft prevented you from completing your tax return.
6. Service issued with HMRC online services
7. Postal delays
8. Disability delays

After the resolution of reasonable excuse, you must send your return or payment to HMRC as early as possible.

What will not count as a Reasonable Excuse

The excuses which are not considered as reasonable and not accepted by HMRC are as follows –

1. Bouncing of cheque or payment failed due to less money
2. Difficulty in using HMRC online system
3. No reminder from HMRC
4. Mistake on your tax return
5. You believed on someone else to send your tax return and he or she failed.

Estimate Your Penalty for Late Self-Assessment Tax Returns & Payments

You must take an estimate that how much you need to pay for penalty and for the interest in case you missed the deadline for –

• Sending Self-Assessment Tax Return
• Paying Self-Assessment Tax Bill

Related Topics

• Self Assessment Tax Return
• Sending a Self Assesment Tax Return
• Self Assessment Tax Return Deadline
• Self Assessment Tax Return Penalties
• Amend Self Assessment Tax Return
• Tax Return for Deceased Person
• File Your Tax Return Online
• Register for Self Assessment Tax Return
• Keep Your Tax Records
• Self Assessment Tax Bill
• Pay Self Assessment Tax Bill
• If you cannot pay tax bill on time
• If you do not pay your tax bill
• Claim a Tax Refund