HMRC wrongly took £43k from my pension — six months on, still no refund

I completed a double taxation form, which had to be validated by the French authorities. This took about two months to sort out. I then sent that form to HMRC to claim my refund, but that was six months ago now.

Since then I have called HMRC several times — each time I have been told that it will get back to me by a certain date, only for it to miss these deadlines. I’ve been left feeling incredibly frustrated as no one seems to be able to give me a definitive answer as to when I will get my rebate. I’m also anxious that it will never get settled.

This delay is stopping us from being able to invest this money here in France. We want to bring our savings up to an amount so that on our death, our children will be able to use it to pay inheritance tax (IHT) in France, which must be paid before any assets from the estate can be released. It’s likely that our three children will have to pay about €90,000 in IHT, which is an enormous sum for a family to lay their hands on at short notice. We want to make sure this money is accessible for them, so we plan to invest this money in such a way that it falls outside our estate. I’m terribly anxious in case anything happens to us before this arrangement is in place.

I’m also frustrated that we have missed out on interest on my investment over the past eight months. Not only is this stressful but it’s very annoying to have to keep chasing our money, which should have been paid by now.
Helen, address supplied

Katherine Denham writes

It seemed sensible to want to make life easier for your children by ensuring there’s a stash of money ready to pay the IHT bill when you die, and I could see how disconcerting it was for HMRC’s delays to be putting that plan on hold.

When you get income from the UK but live in another country, you can be taxed on it twice. Thankfully, many countries like France have double taxation agreements with the UK. Depending on the agreement, it can be possible to apply tax relief before income is paid by getting your tax code changed. This would stop UK companies from deducting tax at all. It sounds like this wasn’t an option for you because you weren’t getting paid UK income through the pay-as-you-earn system.

It is also possible to write to HMRC to explain why a “no-tax” code is applicable to you to prevent tax from being taken from UK income.

Another option is to claim a refund after you have been taxed although, as you discovered, you can be waiting for a while.

As I have said before in this column, I regularly speak to HMRC to try to expedite tax rebates for readers, and I really didn’t think it was reasonable for you to be left waiting for this long.

It was especially disappointing that HMRC kept missing the time frames it was giving you, kicking your refund further into the future. It told me that each of the three times you called, you were given the most up-to-date timescale, but it apologised for the delay.

HMRC said: “We have written to Helen to apologise and we have issued the repayment she is owed. We have recruited and trained additional customer service advisers to improve our response times.”

A few days later your refund arrived in your bank account. I asked if HMRC would pay interest for the months you were without this money, but it wouldn’t.

This was galling, especially as you could have earned hundreds of pounds on £43,000 over six months, yet you were pleased to finally have your money, which you can now invest in France.

You said: “I’m sure you prodding HMRC helped to speed things up, so thank you very much indeed.”

• HMRC took £57k from my pension even though I pay tax in Spain

Going round in circles over river cruise refund

I was due to fly to Budapest last July to embark on a week-long river cruise on the Danube. Early last year I paid £1,899 for the holiday and also bought travel insurance with Coverwise, although the policy is underwritten by the insurance giant Axa. I paid £40 for single trip insurance and, as always, I made sure to declare all of my pre-existing conditions.

But unfortunately, the month before my trip I was diagnosed with a serious illness and was not allowed to fly. I was extremely disappointed because this was to be my first trip alone since the death of my husband. I immediately raised a claim with Coverwise and it passed me on to the insurer Axa, which underwrites my policy.

I have complied fully with Axa’s requests for information and provided all the documents, booking details, cancellation details and medical records. But since then I have been going round in circles as Axa keeps making excuses as to why it won’t pay out my claim. It tells me that it’s being assessed, by either its medical team, loss adjusters or management. I have made about 12 phone calls and sent numerous emails asking Axa to pay my claim.

It then offered me £100 for the delay, which I refused as it still hasn’t reimbursed me for my lost holiday. I asked the ombudsman if it could look at my complaint, but it said that Axa needed to send a final response letter before it could get involved. I have asked Axa for this on two occasions but it hasn’t sent this. After seven months I am still waiting for this to be resolved.

I have not had any communication from the claims department since November and it seems to be ignoring me now.

The whole process is making me very stressed. All I am asking for is a refund of the cost of my holiday, less the £50 excess. I think the company hopes I will give up.
Name and address supplied

Katherine Denham writes

I was really sorry to hear about your husband and it was such a shame that you were then too unwell to go on this trip.

It’s common for insurers to ask for a lot of information to assess a claim, but you told me that you had sent everything Axa had asked for so you couldn’t understand why you hadn’t been reimbursed yet.

Axa told me that it hadn’t received all the information it needed to assess your claim because it needed all of your consultation notes going back five years. It said the medical notes that had been provided didn’t contain the level of detail it needed, which caused some of the delays in assessing your claim. But it also accepted that it could have been clearer in explaining exactly what it required.

I also felt that as soon as it knew that the medical information you provided wasn’t sufficient, it should have told you so that you could have sent what was needed. But instead it took four months and my intervention for it to spell this out.

You were very relieved when it then made the decision to settle your claim in full, paying you £1,849 — £1,899 less the £50 excess — without the need for the extra information. It has also given you £200 compensation.

Axa said: “We apologise for the delays our customer experienced during the processing of her claim. This has now been settled in full and we have confirmed she is satisfied with the outcome.”

Coverwise said: “We’re extremely sorry that the service received fell below the team’s usual standards. We have discussed this case with Axa and we will continue to work together to ensure the claims processes are improved. We were not contacted by our customer about the delays to her claim and would have happily intervened on her behalf given the opportunity to do so.”

You said: “I am so pleased that your input caused Axa to rethink how it had handled my claim. It is such a relief after all of this time.”

• £647,401 The amount Your Money Matters has saved readers this year

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