HMRC is to change the wording of one of its new tax forms for people reclaiming overpaid tax on pension withdrawals, after confusion over who could use it.
Form 55 is to be updated because it currently implies it should only be used if “you’ve only taken one payment and do not intend to take a further payment in the tax year”.
However, the tax office says it can be used by people to reclaim tax who make multiple withdrawals in a year.
People making withdrawals without giving their pension fund a P45 will pay emergency tax and have to reclaim it later.
A HMRC spokesman says: “Claimants presenting their 2015/16 P45 to their pension provider will pay the correct tax. In the event that they don’t, any discrepancy will be settled within 30 days of HMRC being notified.”
In April HMRC revealed three new reclaim forms. In addition to the P55, P50Z is for individuals flexibly accessing their entire pension pot and have no other income, and P53Z should be used for those who use up their entire pot but do have other taxable income in the same tax year.
Form P53Z should be used for people receiving employment income, job seeker’s allowance, taxable incapacity benefit, employment and support allowance or carer’s allowance.