corporation tax

Tax Refund Form Is Causing Confusion

HMRC has said that it will make urgent changes to a new tax refund form which was issued following Government pension reforms. It was conceded that the form was ‘badly worded’ and causing confusion.

They said that they would update the form ‘as soon as possible’ after pensioners complained that the document was misleading. The tax authority has also had to apologise to a 71 year old for any distress caused after it continually advised her to use the form to reclaim thousands of pounds in overpaid tax, when the document stated that she was ineligible to use it in her circumstances.

Form p55 was issued by HMRC on April 6th in order to help pension savers reclaim 30 day refunds on any overpaid tax if they had accessed their pension pot under the new freedoms. Savers were also expected to face upfront tax deductions as HMRC had instructed pension providers to tax pension cash withdrawals at an emergency rate, unless the customer had given them a p45.

One customer said that the form made it impossible for her to claim. She said:

“The p55 form cannot be used to reclaim tax if the person is taking more than one payment in a year which I intended to do. This is clearly stated on the form.”

Following a disagreement between the customer and HMRC, eventually HMRC agreed that she could use the form to reclaim tax, but the form was badly worded and causing confusion. A HMRC official confirmed that it was possible, stating:

“I can confirm that it is possible to use form p55 to ask for a repayment.”