Martin Lewis: £60,000 Earners May Be Due Refunds

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Post on Oct 30, 2024

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Martin Lewis: £60,000 Earners May Be Due Refunds - Are You One of Them?

Have you been underpaying your tax? It's a common problem, and Martin Lewis, the MoneySavingExpert.com founder, has recently highlighted a crucial issue that could be affecting thousands of UK taxpayers. He's warning that those earning £60,000 or more may be due significant refunds, thanks to an oversight in how tax is calculated.

The problem lies in the way the UK's tax system handles the "personal allowance". This is the amount of income you can earn tax-free each year. While the personal allowance is currently set at £12,570, it's not always applied correctly, leading to overpayment of tax.

Here's how it works:

• Tax codes: Your tax code determines how much tax you pay on your earnings. It's based on your individual circumstances, such as your income and whether you're a higher-rate taxpayer.
• Incorrect tax codes: If your tax code is incorrect, you might be paying too much tax. For example, if you're a higher-rate taxpayer, you might have a code that doesn't reflect your full personal allowance.

Why are higher earners affected?

Higher earners are more likely to be affected because they have a higher tax burden. This means even small errors in their tax code can result in significant overpayments.

What should you do?

1. Check your tax code: The first step is to check your tax code. You can do this online through HMRC's website or on your payslip.

2. Calculate your potential refund: If you suspect you might be due a refund, use an online tax calculator or speak to a tax advisor to calculate the amount you're owed.

3. Claim your refund: If you're entitled to a refund, you can claim it through HMRC. There are various ways to do this, including online, by phone, or by post.

Key takeaways:

• Don't assume your tax code is correct. It's always worth checking, especially if you're a higher-rate taxpayer.
• Don't miss out on potential refunds. It's your money, and you deserve to get it back.
• Seek expert advice. If you're unsure about your tax situation, don't hesitate to consult a qualified tax professional.

In Conclusion:

Martin Lewis' warning highlights the importance of being proactive about your tax affairs. Even if you're earning a substantial income, it's crucial to ensure you're not overpaying your taxes. By taking the time to check your tax code and claim any due refunds, you could potentially save thousands of pounds.

Remember, knowledge is power when it comes to managing your finances. Stay informed, stay savvy, and don't miss out on what you're rightfully owed.