HMRC letters sent to 7.5 million over 'mistakes' tax rebates - but some need to take action

Letters are going out to about 7.5 million people who are due a tax refund from HM Revenue and Customs. In some cases it will happen automatically and they will receive a cheque - but in others they will need to take action, officials have warned.

Finance specialists, RIFT, said HMRC is currently sending out the P800 forms. A P800 is a type of tax calculation performed by HMRC to ensure that everyone is paying the correct amount of tax.

If HMRC believes that a person has either over or under-paid tax, they will send out a letter containing a P800 form. In the vast majority of cases, P800 impacts PAYE employees and not the self-employed.

If HMRC calculates that you have overpaid tax, you will be entitled to a refund - or alternatively if someone has paid too little they may get a bill. If the news is good the P800 letter will tell you how you can get your refund. Previously everyone got a cheque automatically however those people who are BACS eligible will need to take action to claim their repayment.

The fastest way to issue this claim is through HMRC’s P800 refund website or the HMRC mobile app. If, however, you’re not given this option, or you don’t do this within 21 days of the form’s issue date, you might need to take further action of face missing out.

If your tax calculation letter says you can claim online

You can also claim a refund:

You’ll be sent the money within:

If you are told you have under-paid your tax, you will be told how much you owe and this so-called PAYE Debt will need to be paid to HMRC as soon as possible. If you cannot afford to pay it all at once, you will be able to spread the payments out over time

Bradley Post, MD of RIFT, said: “HMRC’s PAYE system is an extraordinary machine of tax