Following a car accident, there are usually far more important things on people’s minds than making a compensation claim. In most cases, people will have to deal with their damaged vehicles so that they can carry on getting to and from work each day. In other cases, people might be recovering from the accident or looking after others who were injured in the accident.Continue Reading…
A common question asked by individuals considering PPI claims is that of how long their claim will take.
How Long Does a PPI Claim Take?
There’s no straightforward answer. The average timeframe for a PPI claim at the moment is around 6 – 8 weeks, but a number of factors can influence this:
- If no satisfactory PPI claim outcome is obtained through your provider within 8 weeks, the claim could be escalated to the Financial Ombudsman, which could increase the time it takes to complete the claim.
- Some providers are paying out much more quickly than others. Some, for example, have efficient processes and resources in place to deal with PPI claims and some claims are being turned around in as little as two weeks.
- The circumstances surrounding your grounds for reclaim can affect the time it takes. If there’s clear mis-selling and the PPI policy is one the provider still have on record it can be very efficient to make a claim. If, however, your PPI claim is an older one where the bank is no longer obliged to have your paperwork on file, even if you have your paperwork, proving the mis-selling can be more difficult. This, in turn, could slow the process down.
A common question concerning PPI refunds is whether or not the tax man will want a cut of your compensation.
If you succeed in making a PPI claim, your compensation will often be made up of:
- A PPI refund whereby all PPI premiums you paid are reimbursed
- Interest on all the payments you made at the rate of 8%
The PPI Refund is NOT Taxable
This is, effectively, your own money! It’s simply a refund of monies you paid for a product that was mis-sold. As such, this part of the compensation is not taxable.
The PPI Refund Interest IS Taxable
The interest rate on PPI claims is being paid at a rather generous 8%. This interest payment is taxable if you are a UK tax payer.
This will not be relevant to you if you are not a UK tax payer.
Some providers are deducting this tax at the basic rate of 20% before refunding it. Those providers include:
- All smaller loans providers which are not banks.
Most of the major providers are not deducting tax before issuing the refund however.
Banks not deducting tax automatically include:
- Lloyds TSB
- Co-Operative Bank
My PPI Provider Hasn’t Deducted Tax. What Should I Do?
When you receive your letter confirming your refund, the latter should layout specifically how much is a refund and how much is interest. Send this letter to your tax office explaining that you wish to declare the interest for tax.
My PPI Provider Deducted Tax But I’m Not a Taxpayer!
If your PPI provider is one of those automatically deducting tax but you are not a UK taxpayer, you’ll need to obtain a copy of the RC40 form from the HMRC website and follow the instructions.
Claims Management companies are companies offering advice and often legal services specifically in relation to compensation, damage, negligence or repayment for loss.
Since 2006, such companies in England and Wales have been regulated by the Claims Management Regulator.
Any organisation calling itself a ‘PPI claims management,’ is one specialising in dealing with PPI claims.
PPI claims management companies will often offer advice about the likelihood that you have a PPI claim and will, with your authorisation, act on your behalf in negotiating the reclaim from the provider.
While every company is different, most charge fees varying from 20 – 30% of your successful claim amount plus VAT.
PPI claims management companies must be licensed by the Ministry of Justice.