If you are an employee, the tax system in this country is called Pay As You Earn or PAYE. It basically means your employer calculates and deducts your tax, then they forward it to HMRC. Unfortunately, a whole host of things can happen that may involve you paying too much tax. This results in you getting a Tax Refund.
But, there is always a but, HMRC is unlikely to tell you, so you may well have to apply to get what is actually yours. Apply online now and our agents will file your refund claim and contact you when we have your cash!
What is PAYE?
Pay As You Earn or PAYE is the system of collecting taxes within a tax year through your wages. The tax year starts on6 April of the present year and ends on 5 April the next year.
Three parties are involved in the entire process – you, your employer and HMRC. If there are discrepancies in your tax code or the tax deduction itself, you can complain to either your employer or HMRC.
The frequency at which tax is deducted depends on how often you get paid, whether it’s weekly or monthly.
How does PAYE work?
HMRC will be responsible for calculating your tax code and then providing it to your employer. HMRC usually send you a PAYE coding notice that shows how your code number was worked out. If you didn’t receive one you can request one from HMRC.
Based on the tax code, your employer will then calculate how much tax will be deducted from your pay or pension (per week or per month). Whatever deductions made will then be paid over to HMRC.
If you think you are due tax back for overpaying PAYE then get in touch and we’ll assist you with your tax refund.
Working and paying tax under PAYE?
You can end up paying too much income tax if you change jobs or have more than one job at a time. It is easy to apply for a tax refund through the Taxback apply online now form.
So, when could you have overpaid your tax and be due a tax refund?
- If you started a new job your employer may have given you an emergency tax code for a while or they may have been using the wrong tax code.
- You may have only worked for part of the tax year.
- You’re a student and didn’t complete form P38S Student Employees form to put you on the right tax code
- You had multiple jobs.
- Other income you have that is taxed through your tax code for example, savings/investment income has reduced since you last told HM Revenue & Customs (HMRC) about it – which means the amount of income included in your tax code is too high.
- You ceased working and didn’t get any taxable income or benefits for the rest of the tax year.
- Your working circumstances changed – e.g. you changed from full-time to part-time working or became self-employed.
- You were made redundant and didn’t work for a period of time.
PAYE Tax Refunds if you’re an employee
What can be claimed on a PAYE Tax Refund?
The following tax refunds can also be claimed with Taxback, but if it’s not on the list, get in touch anyway, as we are sure we can help:
- Uniform Expenses
- Car Mileage Allowance
- Tools Expenses and/or Specialist Clothing Allowance
- Working from Home Expenses
PAYE Tax Refunds UK: The Facts
Most people in the UK work under the PAYE system and millions of you are due a tax refund.
Claim your tax refund now. Our average tax rebate is £1324.
What You Need to Know About the PAYE System
As an employee, your tax is automatically deducted through the PAYE system, which will reflect on your payslip. How much tax deducted will depend on your tax code number that is provided by the HMRC.
It is vital that you check the code assigned to you to avoid overpaid tax. If you are not sure, contact us and we will advise what code you should be on.