Older taxpayers overpaying tax
The National Audit Office (NAO) has published a report that concludes that a significant number of older taxpayers are paying the wrong amount of tax – both too much and too little tax. Older taxpayers are defined as those over the state pension age (currently 60 for women and 65 for men).
The NAO estimates that, by March 2009, as a result of discrepancies between HMRC’s records and tax deducted by employers and pension providers, around 2 million older people had overpaid tax by between £170 and £207.
Older people may also be paying more tax because:
- they do not claim additional age-related tax allowances. The NAO estimates that some 3.2 million older people do not claim the additional allowances although in some cases the people concerned do not have sufficient income to pay tax
- they omit to register to receive interest paid gross on their savings where their taxable income is low enough to permit this.