HM Revenue and Customs has issued an urgent reminder to UK workers that they could be owed significant tax refunds due to common coding errors. Thousands of employees may have hundreds of pounds waiting to be claimed back from the taxman.
What's the emergency tax code issue?
Many workers find themselves placed on an emergency tax code when starting new employment or changing jobs. This temporary measure often results in overpayment of income tax, particularly during the first few months in a new role.
Emergency tax codes like 1257L W1 or 1257L M1 mean you're being taxed without accounting for your personal allowance or previous earnings in the tax year. This frequently leads to substantial overpayments that HMRC is legally required to refund.
How much could you be owed?
While individual refund amounts vary, many taxpayers discover they're due £100 or more. Some cases involve significantly higher sums, depending on your income and how long you've been on the wrong tax code.
The refund process is typically automatic, but there are important steps you should take to ensure you receive what you're owed.
How to check and claim your refund
Check your payslips: Look for tax codes ending in W1 or M1, which indicate emergency taxation.
Review your P60: Your end-of-year certificate shows total tax paid and should highlight any discrepancies.
Wait for your P800: HMRC usually calculates and notifies you of overpayments between June and October via a P800 tax calculation.
Use your personal tax account: The government's online service allows you to check your tax status and see if a refund is due.
What if you don't receive a P800?
If you believe you've overpaid tax but haven't received notification from HMRC, you can contact them directly to request a review. Keep all your payslips and P60 documents handy as evidence of your earnings and tax payments.
Most refunds arrive within 5-10 working days once processed, either as a direct bank transfer or through adjustments to your tax code for the following year.
Don't leave free money with the taxman - take five minutes to check your documents today. Many Brits are discovering unexpected windfalls simply by being proactive about their tax affairs.
