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Make sure your pension withdrawals are not being over-taxed

Many savers who have accessed their pensions early under the new pension flexibility rules may have been over taxed.

It is reported that hundreds of thousands of tax-payers have been overcharged as a result of Her Majesty’s Revenue and Customs (HMRC) treating the lump sum they have withdrawn from their pension savings as the first of a series of regular income payments, rather than as a single payment.

In total HMRC have refunded £262 million in overpaid tax collected as a result of this issue.

If you believe you may have been over-taxed on any pension withdrawals you have made, you will need to contact HMRC and fill in the appropriate tax reclaim form. Help and support is available free from the Pensions Wise website www.pensionwise.gov.uk/en. If you are aged 55 or over you can also book a phone interview with the Pensions Advisory Service or with Citizens Advice. Alternatively, you may wish to see an Independent Financial Adviser.

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