In this guide
Financial windfalls can be very welcome. But sometimes people don’t even know they are due one, and that all they need to do is make a claim.
It may be you are eligible to reclaim money from banks or the government. The money that you get back can run to hundreds or even thousands of pounds, so it is worth checking whether you have a chance to claim.
In this article, we cover:
- How to reclaim charges for a bank account
- Whether you are being overcharged for council tax
- How to reclaim for a mis-sold guarantor loan
- Reclaiming tax on PPI
- Claiming back bank overdraft charges
Ever paid a fee for your bank account? Check for a claim
If you have ever paid a monthly fee for your bank account, you may find you are eligible to reclaim that money.
This is because many of these accounts were sold without the banks checking whether the accounts were suitable for the people who bought them.
If the bank or financial ombudsman decides that you were mis-sold your current account, you may be given back all the fees you paid. This can be a substantial sum of money.
Paid-for bank accounts are also known as “packaged” accounts, because they package other products, such as travel insurance and breakdown cover, together with everyday banking. Check here for our guide to the best paid-for bank accounts.
When can you reclaim?
If you use the extras, these accounts can represent good value for some people.
However, you may be able to reclaim the fees if you were:
- Not told that you weren’t eligible for the travel insurance, for example, due to age or a medical condition.
- Unaware that you had been upgraded to the account.
- Told you had to have a paid-for account to get a mortgage or overdraft or to improve your credit score.
If you were given the ‘hard sell’, or tried to cancel but were told you had to keep the account, you could also have a case.
The Financial Conduct Authority, the UK regulator, says you can make a claim within:
- Six years from when you were sold the account.
- Three years from when you knew, or could reasonably have known, that there was a problem with the account.
In practice, this means you can attempt to claim fees back from accounts sold a long time ago.
How do you make a claim for a mis-sold packaged bank account?
If you believe that you were mis-sold a packaged bank account, the first step is to contact your bank.
Make your complaint either in an email or a letter. This means you should have a copy of all the correspondence.
Go into detail, enclosing bank statements showing how much you have paid for the account over time, and explaining why you think you have been a victim of mis-selling.
For example, if you were unable to use the insurance on the account due to medical exclusions, explain this. Or if you were told that you had to have this account to get a mortgage, give as much detail as you can.
The free Resolver tool can help you to make a complaint.
After eight weeks, if your case is not resolved, you can escalate it to the Financial Ombudsman Service, which will make a final, binding, decision.
See here for our guide to the best current accounts.
Are you in the wrong council tax band? You could be due £1,000s back
The amount of council tax you pay each year depends on your local authority and the “band” you are in, which relates to the value of the home you occupy.
However, these bands were allocated in 1991 for England and Scotland, and 2003 for Wales, and often by estate agents in a hurry – so many properties are wrongly banded.
If you are in this position, you could reclaim thousands of pounds.
How can you check if you’re in the wrong band?
The first step is to check whether your home is in the same band as similar homes in the neighbourhood. You can check your band, and those of your neighbours, here.
The next step is to work out what your property would have been worth in 1991, when the valuations were done.
- Use property websites such as Zoopla or Rightmove to work out sale prices in your area.
- Take the Nationwide House Price calculator to see, from this, what the homes would have been worth two decades ago.
- You can then check this against the property values on this government website, to see whether your home is in the right band.
Could you be missing out on a discount?
There is another way to get money back on council tax.
You could get a discount on your council tax if you:
- Live alone
- Are a student and have only students within your home
- Live with someone who has a severe mental impairment or a disability requiring extra living space or rooms.
- Have a carer living with you
- Receive pension credit
- Are renovating your home and it is currently not habitable
- If the home is empty for one of the qualifying reasons
If you think any of these apply to you, you can apply for a discount here.
How to reclaim – and the risks?
Reclaiming money for an incorrect council tax band is not risk-free.
You must apply for a “reassessment” – which means that your property could go up into a higher-valuation band, as well as down. And your neighbours could be reassessed too.
If you have lived in the property for fewer than six months, you can write and challenge your banding.
In England or Wales, you must do this through the Valuation Office Agency (VOA) and you should provide evidence of similar properties in a lower band than yours. There is more information on how to do this here.
For those in Scotland, you can launch a challenge through the Scottish Assessors, and there is more information on how to do this here.
Ring the VOA to discuss this: 03000 501 501 in England, or 03000 505 505 in Wales.
If you have lived in a property for longer than six months, you can still explain why you want a property to be rebanded.
Reclaimed PPI? You can reclaim your tax too
If you have received a payout for mis-sold payment protection insurance (PPI), you can also claim back any tax paid on it.
If you were awarded a PPI payout, you will have got this payout with interest added.
However, tax will usually have been paid at a rate of 20% on the interest you received – and this can be reclaimed.
When can you reclaim?
You have four years from the payout in which to complete the reclaim forms. And you will be eligible as long as you are either a non-taxpayer or had enough of your personal savings allowance left in the year you received the payment to cover the interest paid.
The personal savings allowance is £1,000 for basic-rate taxpayers, £500 for higher-rate payers, and nothing for additional-rate taxpayers.
How do you reclaim?
If you live in the UK, you fill in form R40, available here, and if you live overseas, you fill in form R43.
There is more information on how to complete the form on the website of educational charity the Low Incomes Tax Reform Group.
Reclaim guarantor loans
If you have paid a guarantor loan – either as the borrower or as the person who commits to making the repayments in the event of the borrower defaulting – you may be able to reclaim interest and fees, as well as 8% interest on top.
These personal loans, which have high interest rates, rely on you finding a “guarantor” who would pay the loan if you were unable to.
It sounds a good option for those with imperfect credit records.
But according to MoneySavingExpert, they have now overtaken the scandal-ridden PPI policies for customer complaints about financial products.
The troubled lender Amigo has been the biggest name for these types of loan, while Buddy Loans and Bamboo are among other firms that offer them.
When can you reclaim?
If you were sold a loan and couldn’t afford it, either as borrower or guarantor, you may be due money back.
Grounds for complaint if you are a borrower include:
- The lender failing to check your credit records and outgoings before giving you the loan.
- If you have struggled, the lender not treating you fairly before involving debt collectors.
If you are a guarantor, the lender should have:
- Checked that you understood the implications of underwriting the loan repayments.
- Carried out affordability checks on you.
- Written to you if the borrower took out extra loans.
If you feel these things have not happened, you may be able to make a claim.
How do you reclaim?
Amigo was banned from advancing new loans in May 2021, and at present it says claims for mis-sold loans are on hold. It has set aside hundreds of millions of pounds in compensation to customers, pending High Court approval.
But you can still make a claim to get in the queue for payouts. Other firms’ payouts are not on hold.
In all cases, you can write to the lender directly to explain why you are due repayment, or you can use the Resolver tool.
After eight weeks, you can escalate your complaint to the Financial Ombudsman Service for a binding decision.
Reclaim bank overdraft charges
Many of us have paid fees for going over our agreed overdraft limit, and in some specific cases it is possible to reclaim these.
Banks can charge you for using an unarranged overdraft, for bounced cheques and other missed payments.
It used to be quite easy to reclaim these charges, simply by writing to your bank, but this has now become more difficult.
When can you reclaim?
If you can prove that you were in serious financial hardship, or if the charges seem disproportionate, such as a £30 overdraft interest charge for going £1 overdrawn, then it may be worth attempting to reclaim the money from the bank.
How do you reclaim?
Write a letter to the bank first, explaining why the charges have affected you so badly.
If the bank rejects your claim (which is quite likely), you may want to take your claim to the Financial Ombudsman Service. This costs nothing.
Important information
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