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Your PPI tax refunds claim doesn’t have to be complicated. You’ve probably heard the words PPI tax thrown around by different law and repayment firms. But how much do you actually understand about PPI, and in particular, PPI tax reclaims? Here at Gowing Law Solicitors, we want to help you understand everything you need to know about PPI. We’ll look all the way back to how it came about in the first place. All the way up to why you may be owed tax on your PPI pay out, and how a top PPI law agency in Manchester, like Gowing Law Solicitors, can help you. Let’s get started with the basics of mis-sold PPI tax.

What is PPI?

Before we explain why you may be able to claim money on a PPI refund, it’s important that we start with the basics of PPI. PPI stands for Payment Protection Insurance. It was usually sold with products that included a repayment, a payment plan or some form of debt. Over 64 million PPI policies were sold to people in the UK between 1990 and 2010, a lot of them having been unfortunately mis-sold. Take a look at this video created by the FCA (Financial Conduct Authority) to give you a basic understanding of PPI and how it could of affect you:

The main thing you need to know about PPI is that it was a policy sold along with loans, credit cards and other “financial borrowing” agreements. It was to ensure that payments could still be made if the borrower was unable to pay back the money due to sickness, unemployment or any other type of emergencies.

Payout Problems

One of the problems with PPI came from the fact that it provided significantly less pay-out than what was owed by the borrower’s loan. However, the real issue came from when many PPI policies did not fit the policy owner. For instance, a lot of people taking out loans to start up a freelance business did not require this policy- after all they were already self-employed! That’s why complaints were raised and policy holders began to demand their money back.

If you were interested in getting a PPI refund with the help of a trained PPI claims solicitor, like those from Gowing Law Solicitors, and were successful, you could find you would be rewarded with one of the following:


Please keep in mind that it is likely that your pay-out will depend on the amount of money that went into the original PPI. If you were forced to spend more money on the PPI then you will be reimbursed for it. Discuss this with your lawyer (from Gowing Law Solicitors) to make sure you can estimate accurately how much you are owed before you make your claim.

Tax and PPI Pay-Outs

Now, for anyone who had been mis-sold PPI, clearly people were interested in getting their money back on this policy. It had no use for them, however this was not the only thing that was a problem with the PPI policy in general. PPI was taxed.

That is why when people received a refund for their PPI, they were surprised to see that they did not receive as much as they expected- namely because tax had been taken away from it. It’s not surprising that claimants were quite upset.

So, you may be wondering why your PPI was taxed in the first place. Well the truth is…


But don’t worry! There is hope for you to get this tax back. This approach to refunding the PPI claim is rather simplistic. It assumes that you are still paying off existing debts or that the tax has gone towards the cost of the loan in the first place. Not all of these conditions apply to all people and this can give you some legal “wriggle room” to make a claim. However, there are other reasons why you may have a PPI tax refund claim.


Could you be owed tax from mis-sold PPI?

When there is a PPI pay out, most firms will have it dedicated a 20% rate. However, 6th April 2016 introduced the Personal Savings Allowance (PSA). This allowance made it easier for tax payers to receive what they were owed. To put it simply:

  • Basic Rate Payers: 20% – Can earn up to £1,000 a year of savings interest tax-free
  • High Rate Payers: 40%– Can earn up to £500 a year, again tax-free
  • Top Rate payers: 45%– Cannot earn anything

One of the best things about these rates is that PPI payments still have the 20% tax automatically taken away before you receive it. If you haven’t earned over your PSA in the same year you managed to get a repayment for your PPI claim, like most people, there is a high chance that you can actually get it back.

But am I really eligible to receive a PPI tax refund claim?

You may be worried about reclaiming your rightly owed PPI tax because of your job status, expatriate, whether or not you pay tax or even due to the fact that you are self-employed. Honestly though, these are not reasons that should worry you. If you have previously taken out sort of monetary contract and are a British tax payer, there is a chance that you could have been unintentionally paying for PPI. It is worth talking about it to a trained PPI specialist.. This is why we urge you to get in contact with Gowing Law Solicitors today. That way we can try our best to help you get your money back.

How much can you get from mis-sold PPI?

Okay, so this is where we have to get our maths hats on. Remember that this depends entirely on your own personal situation and the amount of money that went into the tax on your loan. Even if you are self-employed, you could get a lot of money back from your PPI tax. However, before you figure out how much you are owed keep in mind that:

  • PPI pay outs still automatically have around 20% of tax deducted from them.
  • If you have not earned over the PSA in the year that you paid back the PPI claim, you can pay it back.

Being a combined taxpayer and having a complete interest tallied from your savings and PPI statutory interest should mean that you are due all of your tax back. However, if you have been forced over your PSA then you should only have to pay tax that corresponds to how much you have gone over it by. In order to demonstrate this point, have a look at Roger Rebates’ PPI tax below:

Example Case: Roger


Claim Amounts

Let’s talk about how much you could actually get from a PPI tax refund claim.

Make sure to think about the size of the loan. You can also think of the year it was taken out and how big your PPI pay out is. A good example of how you can figure out how much you can earn is explained by Martin Lewis, a PPI expert. In his interview with ”This Morning”, he gave these examples:

“If you took out a PPI 5 years ago and received a £1,000 pay out, you can receive around £60 tax in return. However, if you took it out 10 years ago then you could receive around £100.

However, if you were given a large £15,000 PPI pay out and took the loan 5 years ago, you could earn around £900 tax in return. Are you thinking even larger? Well, for 10 years, then that tax return could go up £1,470!”



PPI tax claimants for 2015/2016, you may have missed the claim deadline. This is because you can only backdate PPI tax by four tax years (aka. 6th April 2015 and 2016), meaning the deadline was on the 5th April 2020. However, do not worry! Our PPI solicitors can still help you with your case. Just make sure you have a reason why your claim was late. You may also be allowed to claim if you are a non-tax payer who can use their personal savings allowance.

For more information on this, please contact Gowing Law Solicitors. We would be happy to advise you on the best way forward.

How do you claim any mis-sold PPI tax returns?

Whether you’re after help with your PPI tax, it’s important to have your claim checked by a specialist. Yes, you can do it on your own, contact HMRC or fill out a R40 form to settle your tax, but do you really want to do this on your own? PPI tax returns are complicated. It’s always best to have help if you want to reclaim tax money. Do yourself a favour and contact Gowing Law Solicitors for the best advice possible.

Gowing Law is one of the top PPI tax reclaim solicitors in Manchester. That’s why we have simplified the process and have created a PPI claim form for you to fill out. It includes spaces for your personal information, claim information and our damages agreement. Fill out the form with as much detail as you can. The more information we know about your PPI tax reclaim, the higher chance of a positive outcome. They understand the layout of the R40 or R43 and will help you get your entitled tax. Make sure to take a quick look at the damages agreement before you begin your journey with Gowing Law Solicitors. That means you will be fully prepared to work alongside our PPI tax reclaim specialists.

Learn more about Law Topics!

Gowing Law Solicitors will always do their best to ensure their clients are fully educated about different law issues! That’s why we have decided to create a series of blogs that are detailed but simple. That way they can be accessible for everyone. Check out our latest blogs on immigration, including topics like the basics of immigration and how you can decide on a visa. We hope you enjoy our blog series.

Want more information? Contact us now!


PPI tax claims can be complicated. So, why not simplify the process and have one of our experts handle your claim? All of our lawyers are extremely friendly and would be more than happy to assist you. If you have any questions about PPI tax claims or any other service we provide, please call us on 0800 041 8350, email us at or even fill out our contact form. You can even fill out our PPI tax claims form to simplify the process!

We look forward to hearing from you soon!

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