Overview
- FOI data obtained by UHY Hacker Young shows 5.6 million people paid £3.47 billion more than owed through PAYE in the 2023–24 tax year.
- Tax specialists attribute most overpayments to incorrect or outdated HMRC-issued tax codes, compounded by late or inaccurate payroll submissions.
- HMRC is not obliged to proactively alert individuals to PAYE overpayments, placing responsibility on taxpayers to review their codes and year-end P800 or Simple Assessment notices.
- The tax authority says it is investing £500 million in digital services intended to help people pay the right amount from the outset.
- Experts warn coding activity and error risk could rise in 2025–26 as winter fuel payments are recovered from higher earners and high‑income child benefit charges are collected through payroll.