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Reclaiming tax - time limits cut

Published on 22 March 2010

Time limits for reclaiming overpaid tax are about to be cut from nearly six years to only four years. Although HMRC have reminded agents about the changes, it seems they have neglected to warn the general public.

Currently claims for repayment of overpaid tax may be made for five years and ten months following the tax year to which the repayment relates. 31 January 2010 was therefore the last day for making any such claims for 2003/04 – so that year, and earlier years, are now generally closed. Exceptionally, a concession allows repayments to be made for closed years in cases of official error by HMRC or another government department.

Changes from 1 April 2010

Note, however, the rules are changing from 1 April 2010 for taxpayers in self-assessment (SA). From that date, SA taxpayers will have only four years in which to lodge tax repayment claims. But following campaigns from LITRG and other groups, non-SA taxpayers have another two years until 1 April 2012 before their time limit too is cut to four years. The 2012 date applies to you if, for example, you have paid tax under PAYE or are a non-taxpayer who has had tax deducted on savings which you might be able to reclaim.

This means that if you filed a SA tax return for 2004/05 and/or 2005/06 and need to make any claims for those years for overpaid tax, you will need to do so quickly as the revised deadlines for those two years are respectively 31 March 2010 and 5 April 2010.

Those not in SA still have until 31 January 2011 to claim for 2004/05, 31 January 2012 for 2005/06 and 31 March 2012 for 2006/07. We hope that HMRC will increase awareness over the course of the next two ‘transitional years’ so that as many claims as possible are made.

HMRC have posted guidance about the changes, though not in an obvious place on their website. One key point to note is that if you are, for example, currently within SA but were not within it for 2004/05, 2005/06 and/or 2006/07, you can still claim later as for other non-SA claimants.

Scams – a word of warning

In July last year, we reported that criminals pretending to be HMRC were using emails to contact members of the public and offer tax repayments. These so-called ‘phishing’ scams aim to obtain personal information about taxpayers and their bank account information, which the criminals then use to steal from you.

On 31 January, HMRC put out a further press release warning the public that various scams were still continuing and that criminals were seeking to use the self assessment online tax return deadline, and surrounding publicity, as additional leverage. It is conceivable that the above change in time limits could inspire a new wave of attacks.

As a reminder, the advice if you receive one of these emails is:

  • Check HMRC’s advice to see if the email you have received is listed. The scam email often begins with a sentence such as ‘Following a review of your fiscal activity you are due a refund of tax of £XXX.’
  • HMRC’s website also gives a list of the typical email addresses used by the fraudsters.
  • Forward the suspicious email to HMRC at phishing@hmrc.gsi.gov.uk and then delete it from your computer/mail account.
  • Do not click on websites links contained in suspicious emails or open attachments.
  • Follow advice from Getsafeonline.
  • If you have reason to believe that you have been the victim of an email scam, report the matter to your bank/card issuer as soon as possible.

LITRG has also seen reports that pensioners have been targeted by criminals claiming to be calling from the Department for Work and Pensions (DWP) to check they have received cold weather payments. Again, do not give out personal information or bank details to any such callers. If you are unsure whether you have received your correct entitlements to cold weather payments, follow the advice in our article.

Directgov gives some general information on financial scams and how to protect yourself.

Contact Name: Kelly Sizer (Tel: 0844 579 6700 Fax: 0844 579 6701)

(22-03-2010)

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