5. You bought a life annuity

You can claim a refund if you’ve overpaid tax on income from a life annuity that you’ve bought (sometimes called a ‘purchased 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 usually pay some tax automatically on life annuity payments, at a rate of 20%. But if you don’t need to pay Income Tax because you don’t earn more than your Personal Allowance you can:

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

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.

Reclaim tax

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

Deadline for claims

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

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