Each year HMRC compares the amount of tax deducted from wages and pensions with the amount that was actually due for the tax year as part of its PAYE End of Year Reconciliation process. Any under or overpayment of tax is then notified to the taxpayer using a form P800.

If your employees receive a P800 indicating that there has been an overpayment of PAYE tax, then the position for claiming the refund has changed. Historically, where no action was taken by an individual, they would have received a Payable Order within 21 days of the P800 tax calculation letter being issued, but this automated process has now ceased.

The reworded P800 sets out the revised options for claiming the repayment, which are:

•             bank transfer payment, where the taxpayer logs onto their Personal Tax Account (PTA) for electronic refund direct to their bank account.

•             bank transfer payment, where the taxpayer can use a new online service via GOV.UK to claim their refund by confirming their unique identifier (the P800 reference), National Insurance Number (NINO) and date of birth. This route is only available to taxpayers with access to online banking.

•             Payable Order (cheque payment), where the taxpayer can use a new online service via GOV.UK to claim their refund by confirming the unique identifier (the P800 reference) and NINO.

Whilst repayments will no longer be automatically issued, and requesting online is the new default position, HMRC recognise that some employee groups will still need extra support, and requesting repayments by telephone will be available for those people.

This article reflects the position at the date of publication shown above. If you are reading this at a later date you are advised to check that that position has not changed in the time since. 

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