A NUMBER of simple checks on your taxes could get you THOUSANDS of pounds back – and it could help pay for spiralling energy bills.
Households have been warned of a miserable winter ahead as energy bills are expected to rocket to £3,358 in October.
GettyYou could get THOUSANDS back in tax refunds by a few simple checks[/caption]
That’s when the price cap – which limits how much suppliers can charge customers for their energy – comes into force.
Bills are expected to rise even MORE frequently after Ofgem recently announced a massive shake-up to the price cap review.
It will be reviewed FOUR times a year instead of two – and as wholesale energy prices keep rising, it’s expected these costs will be passed on more quickly to customers.
That means the next price cap review will be in January – and it is expected to soar to an eye-watering £4,200, according to analysts from Cornwall Insight.
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It means that millions will be scrabbling for cash to pay for the increases.
But you could get THOUSANDS of pounds back by checking if you’ve paid too much to the taxman.
We explain five checks to make – and you could get over £22,000 in rebates.
However, this will vary as you might not be eligible to claim back everything – and amounts will vary.
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Make sure you claim the money back yourself instead of going through a third party claims company.
These firms offer help in exchange for a big chunk of the cash that they have won back for you, plus admin fees on top in some cases.
It means you could end up with just a tiny amount of what you could have claimed – like Sun reader Debbie Mountain, who got just £37 from a £237 marriage allowance refund.
Check your tax code – £9,400
If your code is wrong you may be paying thousands more than you need to and you’ll likely be owed money back.
Your tax code determines how much income tax you pay on your earnings – so it’s important you’re on the right one.
You can earn £12,570 between April 2022 and April 2023 before paying tax. This is called your personal allowance.
Most people pay the basic-rate of income tax (20%) and the standard tax code for this is 1257L.
Your tax code will be displayed on your payslip, usually listed near your National Insurance number.
You can also use the government’s online tax checker tool to view your tax code.
To check, use a tax code calculator – there’s one on MoneySavingExpert – to see if your code is correct.
If it’s wrong, contact HMRC to let it know on 0300 200 3300. If it’s right, you don’t need to do anything.
How much you could get in cash back by checking if yours is wrong varies – but one Martin Lewis fan got £9,400 back recently after she discovered she was on the wrong code.
Marriage tax allowance – £1,242
If you’re married – or in a civil partnership – you could be missing out on a £1,242 windfall if you haven’t claimed marriage tax allowance.
The relief allows married couples or people in civil partnerships to share their personal tax allowances.
You can transfer 10% of your tax-free allowance to your partner, reducing the tax you pay by up to £252 a year if you’re eligible.
You can apply at any time and, in some cases, could backdate your claim for up to four previous tax years.
This means you could potentially receive tax relief worth up to £1,242.
To be eligible, the lower earner in a couple must normally have an income below their personal tax-free allowance.
And the other half of the couple must be a basic-rate taxpayer – so earning under £50,000 – but check out the full eligibility criteria here.
It’s free to apply for Marriage Allowance – you can do it on the government website and the person who earns the least needs to make the claim.
Working from home tax relief – up to £500
Even if you only worked from home for a DAY because of the Covid crisis, you could be due a whole years tax relief.
HMRC will, in fact, accept backdated claims for up to four years which means in total you could claim up to £500.
Under the scheme, your tax code is adjusted so you’re not paying as much tax.
The scheme is designed to help people cover the extra costs of working from home, like energy bills and internet connections.
See our explainer on who qualifies for the relief – crucially, your employer MUST have required or asked you to work from home.
HMRC has an online tool to help you submit a claim.
Make sure you have important documents to hand including something to prove your identity like a passport, a recent payslip and National Insurance number.
Council tax refund – £6,160
Thousands of households could be in line for council tax refunds, a Sun investigation recently found.
A whopping £33.7million is sitting in closed or dormant council tax accounts, according to data analysed by The Sun.
That means millions of pounds is waiting to be claimed.
We also found that £52million in refunds had been dished out last year by 50 local authorities, with the average payout standing at £6,160.
There are a number of reasons why you could have overpaid – you could have been placed in the wrong band, or be eligible for a council tax reduction.
If you think you have overpaid on council tax and could be due a refund, then you should get in touch with your council.
You can find a council by using the council finder tool on the Gov.uk website.
Many authorities have different procedures when it comes to dishing out refunds.
While some give them out automatically usually, in some cases you have to apply for a refund.
In most cases, councils have online claim forms you can fill out if you think you are due a refund.
Pension tax – £4,700
If you’ve recently retired and you’ve dipped into your pension pot for the first time, you’ve probably overpaid on pension tax.
You can start dipping into your personal or workplace pension pot from the age of 55 onwards.
If you have recently withdrawn cash from your pension pot for the first time and you took more than 25% of the value of your savings, it is likely that HMRC owes you money.
The first 25% of your pension that you withdraw is tax-free, while the remainder is taxed like any other income.
You can start taking money from your pension in a number of ways – including as a lump sum.
But when taking a lump sum, you might be taxed at an emergency rate and end up paying more than you have to.
The tax code error often happens when HMRC has wrongly applied an emergency tax on the first 25% of withdrawals thinking it’s additional earnings.
It’s why you shouldn’t take out your pension in one lump sum unless you REALLY need to.
New figures from HMRC show that around 7,000 savers overpaid pension tax in the last three months – totalling around £33million.
That means you could be in line for an average payout of over £4,600.
If you’ve paid more in tax than you should, HMRC should pay it back automatically.
To get your cash back quicker, you can apply for a refund instead.
To do this, claim your cash back from HMRC via a from either online or with a paper one sent by post.
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