Thousands of individuals with pension savings are being encouraged to verify if they are eligible for a tax refund from HMRC. Recent data reveals that over £50 million was reclaimed in taxes on pension withdrawals during the period from April to June 2026. Over 12,500 claims were processed during this timeframe, resulting in an average repayment of £4,000 per claimant.

If you were subjected to emergency tax following your initial pension withdrawal, you may be entitled to a refund. This situation can occur when HMRC assumes that your first withdrawal will be a recurring monthly payment, even if you do not make further withdrawals within the tax year.

Typically, individuals can withdraw up to 25% of their pension tax-free from the age of 55, with the remaining 75% subject to standard income tax rates. Adam Cole, a retirement expert at Quilter, emphasized the importance of timely refunds, highlighting that the average repayment of nearly £4,000 could be better utilized by recipients.

Claiming back the excess emergency tax paid can be done online by completing a specific form. Alternatively, individuals can choose to wait for HMRC to refund them at the end of the tax year. Cole emphasized the need for strategic planning and professional advice to prevent overpaying taxes upon withdrawal.