If you’re self-employed or own a business and believe you’ve paid too much tax, you might be entitled to an HMRC tax refund.
If you’ve made a mistake on your tax return, or if you think you’ve overpaid, read our guide on how to claim a tax refund.
Is there an HMRC tax refund?
HMRC is required to refund you if you’ve paid too much tax. If you’re employed and paid through PAYE, this is often calculated automatically – though sometimes you’ll have to double check your records and contact HMRC.
But getting a Self Assessment refund can be trickier. In some cases, HMRC will work out that you’re owed a tax refund and send you a P800 tax form to let you know.
However, it can be difficult for HMRC to know you’ve overpaid, particularly if your claim is due to expenses. That’s why it’s so important to keep good records and contact HMRC immediately if you think you’ve paid too much tax.
Why you might need an HMRC tax refund
You might require a Self Assessment tax refund because you think you’ve overpaid when making your payments on account.
It’s also quite common for self-employed people to make mistakes on their Self Assessment tax return, which results in them paying too much tax.
There’s a number of reasons why this happens. You might have simply miscalculated how much you’ve been paid over the year, and paid tax on money you haven’t actually received.
You can also easily make mistakes when it comes to your expenses. For example, if you accidentally input an expense as £100 instead of £1,000, your overall allowable expenses will be lower. As a result you’ll pay tax on more of your taxable profit, which means you’ll have paid more than you owe.
Tax rebate calculator
If you think you’ve overpaid your tax bill, you can use RIFT’s tax rebate calculator to work out how much you could be owed.
Once you have an estimate, you can follow the steps below to amend your tax return.
How to do an HMRC tax refund
As we’ve mentioned, you’re likely to need an HMRC tax refund for two main reasons – because you’ve overpaid when making your payments on account or because you’ve made a mistake on a return.
If you overpay your payments on account, HMRC will usually refund the excess amount to you. The refund will be made after HMRC has processed your tax return for the relevant tax year. Alternatively, you can put it towards your next tax bill.
You can also request a refund of any overpayment by contacting HMRC directly. You’ll need to provide evidence of the overpayment, such as a copy of a bank statement showing any relevant payments.
If you overpay your payment on account but still have outstanding tax liabilities, HMRC will use the excess payment to offset the outstanding liabilities. Any remaining balance will then be refunded to you.
Sometimes, however, the opposite may be the case – you may have been paid too much, for example in tax credits, and will be required to make a repayment to HMRC.
If you’ve received a tax credit overpayment but are also entitled to a separate refund, HMRC will deduct the amount you owe from the amount to be repaid to you.
How to correct a tax return
You can correct a tax return through the government’s Self Assessment portal – the same place that you completed your return in the first place.
To make a correction to your tax return:
- Log into your HMRC account
- Navigate to your Self Assessment account
- Click on ‘More Self Assessment details’
- Click ‘At a glance’
- Select ‘Tax return options’
- Choose the tax year you want to amend
- Make the amendment directly in the tax return form
Remember – you may have to provide supporting evidence if you want to correct a tax return. As always, it’s important that you keep full and accurate records of your business finances.
Is there a time limit for correcting an HMRC tax return?
Normally, tax returns can only be corrected up to 12 months after the Self Assessment deadline for the relevant tax year. So, if you made a mistake on your 2023-24 tax return, you would normally only be able to amend it up to 31 January 2026.
However, there are some circumstances when you may still be able to claim your tax refund even after this deadline has passed.
HMRC has a scheme called ‘overpayment relief’ for these situations. However, the process for claiming a refund through overpayment relief is different – you’ll need to contact HMRC directly and explain the mistake and how it was made.
To do this, you’ll need to write to HMRC using the contact details on your most recent letter from them. You should explain the mistake, and make sure you provide supporting evidence to back up your claim (for example P45s if you moved from employment to self-employment).
Finally, make sure you get proof of postage from the Post Office when you send your letter.
How long does HMRC take to refund Self Assessment tax?
If you’re owed a tax rebate you’ll normally get paid within two weeks, according to HMRC. However, some tax specialists suggest it can take up to 12 weeks.
If you’ve made an online claim for a tax rebate, HMRC says you should wait four weeks before contacting them about your payment.
Do you have any unanswered questions about how to get a tax rebate? Let us know in the comments below.
Useful guides for the self-employed
- Business tax – a guide for small businesses
- What is tax relief? A guide to small business tax relief
- Dodgy email from HMRC? Here’s how to avoid falling for a scam
- Why do I need business insurance?
Looking for self-employed insurance?
With Simply Business you can build a single self employed insurance policy combining the covers that are relevant to you. Whether it’s public liability insurance, professional indemnity or whatever else you need, we’ll run you a quick quote online, and let you decide if we’re a good fit.
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