Overview
- New HMRC data show refunds totaled £48.7 million between April 1 and June 30 for overpaid tax on pension withdrawals.
- Retirement expert Helen Morrissey estimates close to 13,000 refund claims were processed, with average repayments around £3,800.
- The overcharge typically affects first-time lump-sum withdrawals because PAYE applies a non‑cumulative 'month 1' code that assumes monthly repeats.
- Savers can reclaim through specific HMRC forms or wait for year-end reconciliation, a process widely described as an administrative headache.
- Advisers recommend taking a small initial withdrawal and planning cash needs to reduce unexpected tax deductions, with no permanent fix announced.