Claim back tax if you've had too much deducted from your pension

If you pay tax on a company, personal (including retirement annuity) or State Pension through PAYE (Pay As You Earn - the system used by employers and pension providers to deduct tax from your wages or pension) there are several reasons why you might end up accidentally paying too much. If you've overpaid tax, you can claim it back.

On this page:

Why you might have overpaid tax through your pension

Common reasons why you may have overpaid include:

  • your pension provider has used the wrong tax code by mistake or they don't have the right personal information for you
  • your taxable State benefits or other taxable income has reduced and HM Revenue & Customs (HMRC) don't know about it - which means the amount of income included in your tax code is too high
  • the amount of annual State Pension included in your tax code is wrong
  • you have more than one tax code because you have several pensions or pension and employment income and you haven't used up all your allowances on your first tax code although your other tax codes assume that you have
  • you have received one or more pension lump sums (also known as 'trivial commutations') which are payments taken instead of a small monthly pension

Understand your tax code

If you have more than one tax code

More on how retirement annuities are taxed

Find out more about options when you take your personal pension and how lump sums are taxed (Opens new window)

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Checking your tax code if you're in PAYE

If you're employed, or your pension or annuity is dealt with through PAYE you can look at your latest PAYE Coding Notice to check what type of, and the amount of tax-free allowances you get - you will pay tax on anything above your tax allowances. The PAYE Coding Notice confirms your tax code and this should match the one shown on your employment or pension payslip. It is usually sent to you before the start of the tax year and also during a tax year if a change of circumstances results in a change of tax code.

If you have several different pensions taxed through PAYE, or you work and get one or more pensions, you should get more than one Coding Notice - in this case it's especially important to check them all.

In certain circumstances, you may not get a PAYE Coding Notice every year - for example if you retire early. If you are concerned that you may be paying too much tax but don't have a document that you can check please contact HMRC.

Read these related guides to find out what to look for:

Understand your PAYE Coding Notice

Check your tax if you have more than one tax code

Read about allowances that can reduce your Income Tax

Contact HMRC

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Claiming a refund through PAYE

If you've just retired and have no pension income due

If you've just retired and don't expect to receive any other sort of taxable income (including pension income) at all during the tax year then you should do the following:

  • complete form P50 Claiming tax back when you've stopped working
  • send it to HMRC along with Part 2 and Part 3 of your P45 (a form that you get from your employer when you stop working for them)
  • keep part 1A as a record of your income

HMRC will then send any refund due to you in the post.

Go to form P50

PAYE form P45 - find out more

Contact HMRC

If you receive a pension or retirement annuity through PAYE

If you are receiving taxable pension income (including a retirement annuity) through PAYE and you find an error within the current tax year, contact HMRC. They will send a revised PAYE Coding Notice to your pension provider who will adjust your tax code to alter any further payments for that year. An overpayment will be corrected automatically by your pension provider who will refund the tax in the next payment. You may pay less tax the following month or if it's a large amount you'll get a refund (marked R on your payslip).

Contact HMRC

Making a claim - previous tax year

You can telephone or write to tell HMRC why you think you've paid too much tax on your earnings or pensions for the tax years from 6 April 2010. They may already have everything they need to check your claim. If not, they'll tell you what information they need. HMRC will send you a P800 Tax Calculation and any refund due.

In most cases you'll get back the tax you've overpaid as long as you claim on time. Read the section 'Time limits for claiming back tax'.

Contact HMRC

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Claiming a refund on a retirement annuity

Since April 2007, income from retirement annuities has been taxed through the PAYE system - if you think you've overpaid in this way see the section 'Claiming a refund through PAYE' above.

However, before April 2007 retirement annuities were taxed at 22 per cent unless you completed a form R89 'Application to receive an annuity without tax taken off', or form R86 'Application to receive a joint annuity without tax taken off'. If you didn't complete one of these forms you may have overpaid tax if you were a non-taxpayer or only paid 10 per cent tax in those years.

The forms R89 and R86 are no longer in use (except for 'purchased life annuities'), but if you've overpaid you'll be able to claim some tax back using form R40 Tax Repayment. If you make a claim before 31 January 2013 you'll be entitled to be repaid back to April 2007. If you make a claim on 1 February 2013 you'll miss out on any repayment due to you up to April 2007 and your claim will only go back to April 2008 - also read the section below on time limits for claiming back tax.

More on how retirement annuities are taxed

Go to form R40 Tax Repayment and help notes

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Claiming a refund on a pension lump sum

If your pension pot is small you may choose to take it all as a lump sum rather than using it to get a small regular pension. If you've received one or more lump sum payments it's possible that the tax you paid was more than you were due to pay over the tax year. From 6 April 2013 any new lump sum payments will be taxed at the basic rate. So if you are a basic rate taxpayer you should not be due a refund. If you are already receiving a pension and you choose instead to take it as a lump sum you will be taxed using the tax code that is already in place. If you are not sure if you're due a tax refund please contact HMRC using the link below.

If you want to apply for a refund:

  • complete form P53 on screen with details of your estimated income for the year
  • print and return it to HMRC with Part 2 and Part 3 of your form P45, please note that we will not be able to deal with your claim without this part of the form
  • keep P45 Part 1A as a record of your income

You can also get a paper copy of the claim form. Contact the Taxes Helpline using the link below and ask for a form P53 repayment claim. If you are not UK resident for tax purposes you should not complete form P53. Instead read the guide 'Making a claim under a double taxation agreement' or phone HMRC - links below.

It's important that any estimates you provide are as accurate as possible. HMRC will check at the end of the tax year and contact you if there's a change to the amount of tax you need to pay. If you complete a Self Assessment tax return, you should show the actual details on your return at the end of the year.

Taking a small pension pot as a lump sum

Making a claim under a double taxation agreement

Taxes Helpline

Form P53 - Small pension taken as a lump sum: repayment claim

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Time limits for claiming back tax

The time limits for claiming a refund are shown in the table below. If you don't make a claim within the time limit you'll miss out on any refund due.

Time limits for reclaiming tax
Tax year Tax year ended on You must claim by:

2010 to 11

5 April 2011

5 April 2015

2011 to 12

5 April 2012

5 April 2016

2012 to 13

5 April 2013

5 April 2017

2013 to 14

5 April 2014

5 April 2018

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Documents you'll need to make a claim

When you're claiming tax back (except when you're claiming back tax through form R40) you'll need to include any relevant documents about your income during the tax year for which you're claiming, such as:

  • payslips
  • forms P60, P45
  • information about your employment and benefit history
  • information about your pensions and other income

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How you'll get your refund

HMRC will normally send you a payable order by post unless you tell them to pay the refund directly into your bank or building society account. You can also nominate someone else to receive the refund and it can be paid by post or directly into their bank or building society account.

There are sections about how you would like HMRC to pay your tax refund on all the relevant forms.

Contact HMRC

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Claiming tax back for someone else

If someone has appointed you to manage their financial affairs, or if you're a spouse/civil partner or relative of someone who has difficulty making a claim or who has died, you may be able to claim tax back for them. Get in touch with their usual HMRC Office or the HMRC Office that deals with repayment claims.

Contact HMRC

How to deal with HM Revenue & Customs for someone else

Claiming back tax on behalf of someone who has died

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More useful links

Getting tax-free interest on savings and claiming tax back

Ways you pay Income Tax

How to correct mistakes in your Income Tax

Tax and National Insurance after State Pension age

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