HMRC could be sitting on millions in unclaimed tax refunds owed to construction workers, according to research by tax refund service RIFT Refunds.
RIFT’s data shows that PAYE construction workers could be failing to claim £300m a year. It said there are an estimated 2.3m construction sector workers in the UK, with 1.5m of these classed as PAYE employees.
Unlike self-employed workers who deduct travel expenses as part of their annual self-assessment tax returns, RIFT said many PAYE construction operatives like labourers, ground workers and bricklayers, are required to claim these expenses back from HMRC each year.
The refund service’s research found that 31 percent of all PAYE construction workers who qualify are eligible to receive a refund from HMRC. However, their claims payout account for just 30 percent of the total money owed on an annual basis.
The research also found that average worker receives a refund of £934 per one year claim and £3,735 as an average refund for a four-year claim, meaning that the total amount due to the 31 percent of PAYE construction workers, eligible for a refund, could sit as high as £428m.
However, with possibly just 30 percent being claimed each year, RIFT estimates that HMRC is sitting on an annual sum of about £300m in unclaimed tax refunds owed to around 320,000 PAYE construction workers.
With workers also able to backtrack claims for up to four years, the tax refund service said HMRC could be sitting on even more in rightfully owed tax.