People who receive certain HMRC letters may be ‘owed money’

HMRC works out each person’s code based on their ‘tax-free Personal Allowance and income’ they haven’t paid tax on

HMRC is urging taxpayers to ‘skip the bank trip’ by taking a simple step that could speed up tax refunds. These lump-sum payments are generally issued whenever someone has paid too much tax, perhaps due to a change of jobs, incorrect tax codes or multiple income sources.

In a post to X, formerly Twitter, HMRC said this week: “Skip the bank trip! If you’ve had a letter from us saying you’re owed money, request your refund straight to your account. Download the HMRC app to check.”

While HMRC generally sends correspondence to those due a tax refund, it’s also vital to check wages and financial information to avoid overpaying. A simple way to do this is to examine the tax code on a payslip and verify that it is accurate for a given situation.

HMRC works out each person’s code based on their ‘tax-free Personal Allowance and income’ they haven’t paid tax on. This includes untaxed interest and part-time savings, plus the worth of benefits like a company car. Currently, the most common code for those with one job or a pension is understood to be ‘1257L’.

In this, the ‘L’ shows that you’re entitled to the standard tax-free Personal Allowance – the amount someone can earn each year before paying tax. This figure is currently £12,570, which explains the ‘1257L’ code.

Taxpayers can check their codes on GOV.UK or the HMRC App. Anyone who believes they have been incorrectly taxed on income may complete an online form provided by the Government to claim a refund. Specialists at RIFT disclose that the average amount reclaimed in tax rebates across the UK totals £3,000, based on its examination using ‘average total claims data for a four-year period’.

What else can you do on the HMRC App?

Throughout 2025, HMRC recorded over four million downloads and more than 136 million logins to its app. The department noted that customers are primarily using it to manage day-to-day tax matters, with significant ‘strong growth’ observed in several key areas.

This included a substantial increase in older and retired people checking State Pension forecasts, along with hundreds of thousands attempting to claim Child Benefit. Storing National Insurance numbers in digital wallets was another common reason for using the app, but its advantages extend far beyond this.

According to HMRC’s website, you can use the app to check your:

• Tax code
• National Insurance number
• Income and benefits
• Employment and income history from the previous five years
• Unique Taxpayer Reference (UTR) for Self Assessment
• Self-Assessment tax and how much you owe
• Child Benefit
• State Pension forecast
• Gaps in National Insurance contributions

You can also use it to:

• Track forms and letters you have sent
• Claim a refund if you have paid too much tax
• Ask HMRC’s digital assistant for help and information
• Update your name
• Update your address
• Save your National Insurance number to your digital wallet
• Check for gaps in your National Insurance contributions and the benefits of paying them
• Check if you can make a payment for gaps in your National Insurance contributions
• Choose to be contacted by HMRC electronically, instead of by letter
• Get an estimate of the tax you need to pay
• Make a Self-Assessment payment
• Make a Simple Assessment payment
• Set a reminder to make a Self-Assessment payment
• Access your Help to Save account
• Use its tax calculator to work out your take-home pay after Income Tax and National Insurance deductions

The HMRC app is available for free on both Apple’s App Store and Google Play. Once a personal ID is created, users can generally access the app by signing in with either a six-digit pin, fingerprint or facial recognition.

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