Consumer rights expert Martyn James explains all the ways you could be owed money back
It’s Awful April – and all around the UK people are complaining as their bills go up and budgets already under strain get tighter.
But did you know you can claim back cash you’ve paid to businesses to ease the financial burden a little? It’s not just the obvious things too. Here’s my guide!
Energy overpayments
Energy companies often charge you higher amounts over summer so you build up a credit balance that you can then use to reduce your payments in winter.
But sometimes they don’t do this, which leaves you basically lending the energy company money for free.
You are perfectly entitled to claim this money back from your energy supplier. But bear in mind that you may face higher premiums when the heating goes on.
However, some energy firms have been criticised heavily for making it hard to do this. You may have to phone them up, for example as you can’t get credit balance refunds through apps or websites.
Other firms claim they can’t issue refunds if a meter reading was given in the last four weeks, which is rubbish.
Don’t let this put you off. Go on to your computer or laptop first to see if your supplier is one of the few that allows you to apply for a refund via the website – rather than the app which will have limited options. Failing that, call the firm and demand your rights.
If you’re having a problem, here’s what Ofgem, the regulator, says about credit refunds.
As a general rule, it makes sense to have around two months’ worth of payments in credit to get you through the Winter period, if you chose to ask for a refund.
Claiming back your council tax
It’s possible that you are potentially owed thousands of pounds if you are in the wrong council tax band. According to MoneySavingExpert, around 800,000 people in the wrong band could be owed an astounding £140million.
If you can establish that you’ve been overpaying on your council tax you can reclaim all the overpayments going back 1993. That’s potentially thousands of pounds.
The complexity is, in order to do this you must establish you are in the wrong council tax band. This is not helped by the rather complicated way councils have of working out how this works. Your band is decided by what your property was worth on the following dates
- April 1, 1991, for England and Scotland
- April 1, 2003, for Wales
Many people will live in properties built after these dates. So the government’s Valuation Office Agency (VOA) jumps in its imaginary time machine and estimates what the property would have been worth on those days.
If you want to appeal your council tax band, start by checking out yours here:
The Gov.uk has a useful tool that helps you work out the value of your property here: https://www.gov.uk/search-house-prices as does MSE, where you can also find a detailed guide to the pros and cons of appealing your council tax band.
As well as mistakes, other things can reduce your council tax band, like changes to your property, what you use it for and significant developments in your local area that affected it’s value.
You’ll can appeal the band in England and Wales here and in Scotland here. If you think there’s been a mistake in the value of your property, then you’ll need to demonstrate that at least five similar properties near you that are in a lower band. These should be around the same size, type, age and style or design
The easiest way to do this is to use the sale price of your home or nearby properties. There are many free websites online with lots of historic prices, as well as the government’s price tracker.
Even if you’re not in the wrong band but you’ve moved house in the not-to-distant past, you may be able to claim a smaller refund. That’s because we pay our council tax up front each month, so if you move shortly after your most recent payment, then that money should be returned to you. If it wasn’t, ask the council for the money back.
Claiming your tax back
In theory, there are lots of tax payments you can claim back if you’ve overpaid. The challenge is navigating the HMRC’s challenging computer and phone systems.
If you’re not sure where to begin, head over to the Gov.uk page on claiming a tax return where you’ll find a list of some of the things that you can claim back. There’s way more than you’d think on the list, including:
- Pay from a job
- Job expenses such as working from home, fuel, work clothing or tools
- Your pension
- A self-assessment tax return
- A redundancy payment
- UK income if you live abroad
- Interest from savings or payment protection insurance (PPI)
- Income from a life or pension annuity
- Foreign income
- UK income earned before leaving the UK
For most of us, it’ll be an overpayment of tax that we are claiming back. Don’t attempt to work out what your refund should be unless you are an accountant with lots of time on your hands. Instead, use the tax refund calculators on the HMRC website.
You will need to have quite a bit of information to hand though. For an Income Tax refund, you’ll need:
- Details of your earnings, both before and after tax was applied. You can get this from your P60.
- Information about your savings.
- Any purchases you’ve paid Gift Aid on.
You have four years from the end of each tax year to claim refunds, so if you’ve been overpaying in error for a few years, you might be owed quite a bit of cash.
Even if you are over the four year limit, then you may be able to get a refund if HMRC has made a mistake. This is known as the ‘Extra-statutory Concession B41’. This can be complicated – and it does involve HMRC admitting it has made a mistake.
Claiming a refund on a credit or debit card
With debit card and credit card transactions, there’s an incredibly useful industry scheme that I often mention in this column called ‘chargeback’.
This allows you to claim refunds for goods or services that have not been provided, or under some circumstances where a refund is owed but the business is not coughing up.
If things you’ve bought haven’t turned up, a firm looks like it’s about to go under, the goods have been misrepresented, or a refund doesn’t materialise, you can ask your card provider to charge back the money to your account.
This can be done urgently if speed is of the essence but in most instances you’ll need to fill out a form explaining what’s gone wrong.
There are time limits for making a claim, usually 120 days from the date of the purchase. Complaints over the quality of goods are usually between you and the retailer. But if they’re blatantly breaching their contract with you, cashback is your best option for a refund.
But without a doubt, the best way to pay for anything online is by using a credit card. That’s because the Consumer Credit Act gives you extra protection if you spend over £100 and under £30,000.
If something goes wrong with a purchase, even if the business goes in to liquidation, you could claim your money back from your card provider. This is known as a ‘section 75’ claim.
You can make a claim if the goods are misrepresented, don’t work or don’t turn up. This also works if you pay a deposit on a credit card too. In fact, you can claim the full purchase price back under these circumstances, even if you paid the rest of the bill a different way.
There are loads of catches and caveats though. The main one is you must buy direct and not through a third party. Oh and make sure you pay off the debt before interest is applied too.
According to UK Finance, the industry trade body, you should make a claim within six years of buying the goods or services or, in cases of non-receipt, when you were due to receive them.
Making claims for cash and the law
You may assume that there would be a single set of timescales for making claims for cash in the courts. But sadly, that’s not the case. There are a range of timescales depending on what you are claiming for, from personal injury to breaches of contract. Where you live in the UK also affects the timescales for claiming.
As a general rule, you usually have to make a claim in England and Wales within six years of the incident, whereas in Scotland this is usually around five years. It’s six years too in Northern Ireland though the legislation – like Scotland – is different.
However, some disputes allow you much longer periods to make claims, like 12 years for land disputes. Others are much shorter, like one year for claims about defamation and malicious falsehood.
Most legal action where you are seeking cash back or compensation will involve ‘simple contracts’ – which gives you six years from ‘the date the cause of action accrued’.
This is – in very rough terms – when the incident you are claiming for occurred. This is open to interpretation and many court cases turn on disputes over when the clock stops ticking on legal action. If in doubt, don’t delay in making your claim!
However, if you have a financial complaint, then the rules for taking your case to the free Financial Ombudsman have a useful clause that means you might be able to make a claim for losses on a policy that you bought decades ago.
Under the ‘six and three year rule’ you have six years from the date you took out the financial product to make a claim, like most other contracts.
However, because you might not realise that there was a problem until years later, you have three years from the point when you should reasonably be expected to be aware of the problem to make a complaint. So if you took out a pension in 1995 but didn’t realise that you were paying excessive commission until last year, you are not too late to make a claim.
The Treasury is considering introducing a ten year cap on financial claims through the ombudsman, so tell your MP that you don’t approve!
- Martyn James is a leading consumer rights campaigner, TV and radio broadcaster and journalist
