Have you received a PPI refund?

If you have received a refund from a PPI claim, the premiums refunded are not taxable.
However, many successful claims are being paid out with a simple 8% interest to compensate the time you were without the benefit of your money.

This interest is taxable.

When a claim is successful, HM Revenue and Customs are informed directly that interest has been paid to you and will check that these amounts have been declared in your returns.

The interest usually has tax deducted at source of 20%. Depending on your personal circumstances you may be entitled to a refund, however, if you are a higher-rate tax payer, you may have additional tax to pay.

If you have received interest on a PPI claim and did not declare it on your tax return information or have any questions, please get in touch with your local office who will be able to advise on making the necessary adjustments to your return.