Claiming Tax Back When Leaving The Uk

With the European Union expanding and borders contracting

, more and more people are entering the UK, with figures reporting over 1,500 migrants entering a day.

Many foreigners believe they do not have to pay any taxes when working abroad. This is however, not true. If you work in the UK you have to pay the government a percentage of your income in taxes, if you earned over your tax-free allowance of 6,475 pounds. However, as a foreigner, you have one big advantage compared to other taxpayers. If you are leaving the UK or have already left, chances are that you may be due a tax rebate, because you will have not taken advantage of your full tax free allowance.

As a foreigner, if you leave the UK part way through the tax year (which you inevitably will, unless you happen to leave exactly on the 5th April!), you will have paid too much tax. Your tax free allowance normally gets allocated evenly throughout the year, as a result if you leave the country half way through the year, you will only have got half of your tax free allowance. Most employers will not consider that you are going to be working a small part of the tax year and as a result you will be on the wrong tax code.

Unfortunately the government does not automatically notify you when you have overpaid tax and they state that the onus is on the taxpayer to claim any refund that they are due. Most people have numerous other things to worry about and either forget or do not realise that they can claim a refund when they leave the country.

You can calculate your tax refund by looking at your P45 which your employer should have given you when you stopped working for them. Take the amount of tax earned and your income for the year and put these figures in a tax calculator to see how large your refund would be.

Even if you have returned from working in the UK you can still claim a tax refund now, as long as it was not more then 6 years ago that you worked there. If you have lost your tax documents you can ask your former employers for a statement of earnings which is a sufficient replacement for the Inland Revenue.

With the global recession hitting people hard, now is a great time to check if you are due a tax rebate. It only takes a few minutes work, and with the average refund at over 1,000 pounds, it could really make a big difference to your finances.

by: David de Souza

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