Research by tax refund experts Rift Refunds has revealed that HMRC could be sitting on millions in unclaimed tax refunds owed to construction workers, who are either yet to claim or completely unaware they are even owed money.
RIFT’s data shows that PAYE construction workers could be failing to claim £300m a year and with the ability to backtrack these claims for the last four years, this could see them owed a lot more.
There are an estimated 2.3m construction sector workers in the UK at present with 1,478,400 of these classed as PAYE employees. Unlike self-employed workers who deduct travel expenses as part of their annual self-assessment tax returns, many PAYE construction operatives like labourers, ground workers and bricklayers are required to claim these expenses back from HMRC each year.
The data shows that 31 per cent of all PAYE construction workers who qualify are eligible to receive a refund from HMRC. However, according to RIFT, the claims payout account for just 30 per cent of the total money owed on an annual basis.
The average worker receives a refund of £934 per one year claim via RIFT and £3,735 as an average refund for a four-year claim, meaning that the total amount due to the 31 per cent of PAYE construction workers eligible for a refund could sit as high as £428,055,936.
However, with possibly just 30 per cent being claimed each year (£128,416,781), RIFT estimates that HMRC is sitting on an eye-watering annual sum of £299,639,155 in unclaimed tax refunds owed to some 320,813 PAYE construction workers. With workers also able to backtrack claims for up to four years, HMRC could be sitting on even more in rightfully owed tax.
Bradley Post, MD of RIFT Refunds, commented: “The construction industry has been looked after to a certain extent, but like the majority of sectors, workers are facing months of uncertainty. With many finding themselves on furlough, we wanted to highlight that there is a notable cash sum due to PAYE construction workers from HMRC that they may be unaware of; money that could well make the difference over the coming months.
“Last year we claimed £20 million back from HMRC for construction workers but we know from our own research that the vast majority are not receiving all of the help that they need in order to claim. The construction industry can be a lucrative one even for the ground level worker and so when things are good, the sum of a thousand pounds might not seem worth the trouble of dealing with HMRC for many.
However, we also know in the wake of the last financial crisis when work was scarce, these refunds suddenly became a lifeline for many. So for those currently worried about the months ahead, they should contact us to see if we can help them. All that we need is a few basic details. These refunds can also be backtracked over the space of four years so with this considered, the sum of money rightly owed starts to become quite substantial.”