HM Revenue and Customs (HMRC) has launched a campaign aimed at pensioners who may have paid too much tax on the interest earned from savings accounts.
The campaign is intended to raise awareness among pensioners that, if they overpaid their taxes, they can claim a refund.
It is also designed to encourage non-taxpayers to register for their savings interest to be paid gross.
Under the law, banks and building societies must deduct 20 per cent in tax on the interest earned in savings accounts before that interest is paid out.
Pensioners who pay their tax at the 10 per cent rate or who do not pay tax at all are entitled to reclaim the amount that has been overpaid in tax deductions. The claims can be made using a Form R40.
The time limit for making a claim is five years from the 31 January following the end of the tax year (5 April).
Non-taxpayers – those whose income falls below the personal allowance threshold – with savings accounts can apply to receive their interest gross, that is without any tax deductions, by completing a Form R85 and giving it to their bank or building society.
As part of the campaign, HMRC will be writing to people claiming pension credits and asking them to check if they have overpaid tax on their savings interest.
Sarah McCarthy-Fry, Exchequer Secretary to the Treasury, said: “If you think you might have been overpaying tax on your savings, check the figures and make a claim if you’re eligible. If it doesn’t affect you, but you know someone it might – spread the word.”
For further help about making a refund claim or registering in order to receive interest tax-free, people can call HMRC on 0845 366 7850 or visit www.hmrc.gov.uk/taxback
