New figures issued today by HMRC (see notes to editors) show that HMRC has now over-taxed pension savers by more than £400 million since the start of pensions freedoms in April 2015. This is income tax which is deducted when individuals make lump sum withdrawals from their pension fund after the age of 55. HMRC routinely tax on the basis of an ‘emergency’ tax code which results in large overpayments which then have to be recovered by individual taxpayers who fill in one of three different claim forms depending on their circumstances. Looking at data for the whole period since Q2 2015, HMRC have had to pay back tax on 174,000 occasions, with the total amount repaid now standing at £402m. In the most recent quarter (Q4 2018) over £30m was repaid to over 13,000 people.
Commenting, Helen Morrissey, Pensions Specialist at Royal London said:
‘HMRC is utterly shameless in the way that it over-taxes people and then expects them to claim a refund. The system should be run for the convenience of taxpayers, not the convenience of HMRC. It is time that this over-taxing spree was brought to an end’.
For further information please contact:
Helen Morrissey, Corporate PR Specialist – Long Term Savings
- Email: firstname.lastname@example.org
- Tel: 0203 272 5433
- Mob: 07919 170 712
About Royal London:
Royal London is the largest mutual life, pensions and investment company in the UK, with funds under management of £117 billion, 8.8 million policies in force and 3,745 employees. Figures quoted are as at 30 June 2018.