UK's HMRC repaid £57mn in pension tax overpayments due to an error affecting those who withdrew funds between April 1 and June 30.

UK's HMRC has repaid over £57mn in pension tax overpayments due to a pension tax error affecting pensioners who withdrew funds between April 1 and June 30. The issue involves overtaxation of pension withdrawals, with experts warning that many people are still being overtaxed on their first pension withdrawals since the introduction of pension freedoms. The reason for the overtaxing is that HMRC applies an emergency rate of tax, where the HMRC assumes the first payment will be repeated every month. To mitigate this, HMRC suggests making the first pension withdrawal as small as possible.

August 07, 2024
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