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HMRC internal manual

Self Assessment Claims Manual

Who can claim: Employees or employers

Employers rarely need to make overpayment relief claims.

See below for more information about

  • employers making deductions in accordance with the PAYE regulations
  • employers making deductions not in accordance with the PAYE regulations
  • other overpayments by employers
  • the exceptional situation where an employer makes an overpayment relief claim.

Employer makes deductions in accordance with the PAYE regulations

The tax that an employer has to deduct and account for under PAYE may exceed an employee’s tax liability. This does not mean that the employer has paid more than the amount they were due to pay.

If an employer, in accordance with PAYE regulations, accounts for more than the employee’s tax liability, the employee reclaims the overpaid amounts.

Employees can do this by

  • asking for their PAYE code to be amended during the year, see PAYE13075, or
  • making an informal claim after the year end (or before the year end if the person becomes unemployed or retires), see EIM71405, or
  • submitting a self-assessment return after the year end, see EIM71410.

If an employee makes a self-assessment but later finds that they have overpaid tax, they may be entitled to make a claim for overpayment relief if they can no longer amend their return.

Employer makes deductions not in accordance with the PAYE regulations - no overpayment relief claim

If an employer deducts and accounts for more tax than is required under PAYE regulations, the employee normally

  • receives repayments from either the employer during the year or HMRC after the year end, and
  • does not need to claim overpayment relief.

Other overpayments by employers - no overpayment relief claim

You should deal with other overpayments by employers following the instructions on dealing with end of year returns at DMBM522290, without requiring an overpayment relief claim.

(This content has been withheld because of exemptions in the Freedom of Information Act 2000)