Check how to claim a tax refund

How to claim a refund on a life annuity

A life annuity is usually a guaranteed income for life, which you buy from an insurer in exchange for a lump sum. You can claim a refund if you’ve overpaid tax on income from a life annuity that you’ve bought.

You usually pay some tax automatically on life annuity payments, at a rate of 20%. But if you do not need to pay Income Tax because you do not earn more than your Personal Allowance you can:

reclaim tax you’ve overpaid
ask to get tax-free income from your life annuity

How to reclaim the tax

Fill in form R40 for each tax year you think you’ve overpaid tax.

You need to claim within 4 years of the end of the tax year you’re claiming for.

Ask for tax-free income

Fill in form R89 and send it to the company that pays your annuity.

If you have a joint life annuity, use form R86.

Tell the company that pays your annuity if your income goes up - you may get a tax bill if your income goes over your Personal Allowance.

Get help

Call the HM Revenue and Customs (HMRC) helpline.

HMRC Retirement Annuity Helpline
Telephone: 0300 200 3302
Calling from abroad: +44 (0)151 471 8436
Monday to Friday, 8am to 8pm
Saturday, 8am to 4pm
Find out about call charges

What happens next

HMRC will do one of the following:

contact you for more information
give you a refund either by cheque (also known as a ‘payable order’) or directly to your bank account
send your refund to your nominee by cheque or directly to their bank account (if you’ve nominated someone else to get the money)
tell you that you’re not due a refund, and why

HMRC will only pay refunds into UK bank accounts.

If you do not have a bank account you can nominate someone else to receive the money or cheque.

HMRC does not send notifications of tax refunds by email. You can report suspicious emails to them.

When you’ll get your refund

HMRC will normally refund you within:

5 working days of processing your claim - if you’re expecting a payment into your bank account
5 weeks of processing your claim - if you’re expecting a cheque (or ‘payable order’)

It can take up to 25 working days after your claim if both of the following apply:

your refund is for tax taken from your pay or pension
you have not got a tax calculation letter (known as a ‘P800’)

If you do not get your refund

You should wait 5 weeks after making an online claim and 6 weeks after making a postal claim before contacting HMRC about the payment.