Facing unexpected HMRC tax refund delays in the UK? Here’s everything you need to know in 2025—causes, impact, scam alerts, and refund tips.
Taxpayers across the UK are facing unusually long delays in receiving HMRC tax refunds in 2025. If you’re waiting on money from HMRC, you’re not alone. Whether you’re employed under PAYE, self-employed, or recently withdrew from your pension, here’s a complete breakdown of the current situation, reasons for delays, potential scams, and what you can do to stay protected and informed.
What’s Happening with HMRC Tax Refunds?
Thousands of UK taxpayers are reporting refund delays from HM Revenue and Customs (HMRC), stretching far beyond the usual timeframes. These issues are especially affecting:
| Category | Usual Refund Time | Current Delay Estimate |
|---|---|---|
| PAYE / CIS Refunds | 4–6 weeks | Up to 5 months |
| Self Assessment Refunds | 2–4 weeks | Up to 12 weeks |
| Pension Withdrawal Refunds | 30 days | 30–45 days (with form) |
Main Reasons for the Delays
HMRC has blamed the delays on a combination of factors:
- Staff shortages: Ongoing resourcing challenges have reduced processing speeds.
- High refund volume: A surge in claims due to overtaxation on one-off incomes and pandemic-related adjustments.
- System upgrades: HMRC is reportedly updating backend systems, which may also be contributing to the backlog.
- Industrial actions: Union-led protests and strikes have slowed services further.
Massive Pension Refunds Triggered
Between January and March 2025, over 15,000 pension savers received average refunds of £2,881, totaling £44 million in overpaid taxes. This refund wave was caused by emergency tax codes applied to lump-sum pension withdrawals.
Tip: If you’ve recently taken a lump sum from your pension, you can claim a refund faster using one of the following forms:
- P55 – If you’ve taken part of your pension
- P53Z – For full pension withdrawals
- P50Z – For full pension withdrawals and you’re not working
These forms are available on gov.uk.
Beware of Fake HMRC Tax Refund Scams
Alongside refund delays, HMRC has issued warnings about an increase in fraudulent tax refund scams. Criminals are sending fake messages pretending to be HMRC officials.
Key Scam Indicators:
| Message Type | Red Flag Example |
|---|---|
| “You are eligible for a tax rebate. Click here.” | |
| SMS | “HMRC Refund: You’ve got £244 pending.” |
| Call | “Urgent: Verify your bank account to process your refund.” |
Remember: HMRC never sends tax refund info by text or email, and they will never ask for bank details over the phone.
To report suspicious messages, forward them to [email protected].
Change in Late Payment Interest Rate
In response to the Bank of England lowering its base rate to 4.25%, HMRC also reduced its late payment interest rate from 8.5% to 8.25% as of May 28, 2025. This change could benefit individuals facing back tax payments or late submissions.
How to Check and Claim Your Refund
You can use HMRC’s online portal to track your refund status. Here’s how:
- Go to www.gov.uk/log-in-register-hmrc-online-services
- Log in with your Government Gateway ID.
- Navigate to the “Tax Refunds” section to see if a refund has been issued.
If no update is shown after 8 weeks, contact HMRC directly or use their webchat tool during working hours.
What’s Next for Tax Refunds in 2025?
Looking forward, experts believe the situation will stabilize by Q3 of 2025 as HMRC brings in additional staff and rolls out digital improvements. However, with ongoing government budget cuts and rising tax scrutiny, delays might become more common in future cycles.
What Can You Do?
Here’s a quick checklist to make sure your refund isn’t delayed further:
| Task | Status |
|---|---|
| File tax return early | ✅ |
| Use correct tax code | ✅ |
| Submit refund forms (P55/P53Z/P50Z) promptly | ✅ |
| Avoid scams – never click unknown links | ✅ |
| Track refund status via HMRC portal | ✅ |
Quick Summary
| Issue | What You Should Know |
|---|---|
| Refund Delays | Expect up to 12 weeks; PAYE/CIS may take longer |
| Pension Refunds | £44M refunded due to emergency tax codes |
| Interest Rate Change | Reduced from 8.5% to 8.25% |
| Scam Alerts | Fake refund emails & texts are rising |
| Refund Forms | Use P55, P53Z, or P50Z for pension-related cases |
Final Thoughts
HMRC tax refunds in 2025 are facing major slowdowns, but you can reduce your wait time by filing early, using the right forms, and keeping an eye out for scams. The best step forward is to stay informed and proactive.
For official guidance, always refer to HMRC’s official website.
