Taxpayers are facing significant delays in receiving tax rebates and National Insurance refunds from HMRC. Some repayments are taking many months and some are taking more than a year.
Refunds that used to land within a few weeks are now more likely to move slowly, particularly where HMRC treats a claim as needing manual processing. That can affect cash flow planning, budgeting and how you approach the Self Assessment season.
Professional bodies have raised concerns about backlogs, and HMRC service updates have indicated that older repayment requests are still being worked through.
What the situation means in practical terms
Tax rebates are often treated as a routine repayment, but for many people they are an important cash movement. Delays can force short-term borrowing, create avoidable pressure on reserves and disrupt plans that assumed the repayment would arrive quickly.
It is also worth being clear about the imbalance on timing. When taxpayers miss deadlines, interest and penalties can follow. When HMRC is delayed, the compensation framework is limited. That makes it sensible to plan on the basis that a refund may take longer than expected, even where the overpayment is straightforward.
Rebates & 31 January Self Assessment deadline
31 January 2026 is the filing deadline for online Self Assessment returns for the 2024 to 2025 tax year. It is also the deadline for paying any balancing payment due for that year and the first payment on account for the 2025 to 2026 tax year if applicable.
If your return shows an overpayment, submitting your return is the step that triggers the repayment process. However, where payments on account have already been made, the position can be more nuanced. An overpayment may be offset against future liabilities rather than repaid immediately, or a repayment may only arise once HMRC has processed the full account position.
In the current environment of repayment delays, where cash flow is tight, it may be appropriate to review whether payments on account are correctly calculated and whether a claim to reduce them is justified, rather than assuming an overpayment will be refunded quickly.
Where you are expecting a refund, leaving your return until the last moment can push you further back in the processing line. Filing earlier does not guarantee a faster repayment, but it does remove one avoidable cause of delay. It also gives more time to deal with HMRC queries that can otherwise freeze a repayment.
How to apply for a tax rebate
The route to a refund depends on how the overpayment arose. The key point is that a rebate is not one single process. Self Assessment refunds sit in one channel, PAYE refunds in another, and National Insurance overpayment claims can be separate again.
1. Self Assessment refunds
If you have overpaid through Self Assessment, you apply by submitting your tax return in the usual way. If HMRC’s calculation shows a repayment, the amount will normally appear as a credit on your Self Assessment account, and HMRC will issue the repayment to your nominated bank account once the claim is processed.
Before you file, check that your bank details are in place and correct in your HMRC online account. Incorrect or missing bank details can create additional delay. Accuracy also matters, because returns that trigger verification checks or require later amendment are more likely to be moved into manual handling.
2. PAYE and pension tax refunds
Where the overpayment relates to employment income or pensions, the refund might arise through an end-of-year PAYE reconciliation, or it might require a separate claim depending on the circumstances. Claims are typically handled through your Personal Tax Account, and some scenarios use a specific HMRC form route.
In practice, delays tend to worsen where the refund depends on confirming income figures, tax codes, benefits-in-kind data or where there has been a change of job, multiple employments or pension payments.
3. National Insurance overpayments
National Insurance overpayments can occur, including where someone has more than one employment. These refunds are often claimed separately and can take time even in normal conditions. Given current backlogs, it is sensible to treat NI refunds as a longer lead-time item and avoid relying on them for near-term cash flow.
4. Double taxation treaty claims
Where a refund claim is made under a double taxation treaty, the process often involves additional documentation and verification. These claims can be slow, and where payment is issued by cheque or involves cross-border correspondence, delays can be compounded. Keeping copies of the claim, supporting documents and any HMRC reference numbers is important, especially if you need to chase progress later.
Steps that reduce delay risk
There is no single fix for repayment delays, but a few practical steps reduce the chances of avoidable hold-ups. Filing accurately and giving HMRC fewer reasons to divert a claim into manual review is the most reliable approach:
- File as early as you reasonably can, especially if you expect a repayment.
- Check your bank details in your HMRC account before submission.
- Keep returns and claims consistent with your records, including dates, pay figures and pension figures.
- Avoid amendments unless they are genuinely needed, because amendments can slow repayment processing.
- Keep screenshots or downloads of submission confirmations and reference numbers.
Planning point for early 2026
If you are expecting a refund, treat it as uncertain timing rather than guaranteed timing. It can still be sensible to submit promptly and correctly, but cash flow decisions should not assume a repayment will arrive quickly. Where a repayment is material, build in contingency and consider whether you need short-term funding to bridge the gap.
Author
Gill Laing is a qualified Legal Researcher & Analyst with niche specialisms in Law, Tax, Human Resources, Immigration & Employment Law.
Gill is a Multiple Business Owner and the Managing Director of Prof Services Limited - a Marketing & Content Agency for the Professional Services Sector.
