How To Claim Payment Protection Insurance (PPI) Tax Refund
If you thought payment protection insurance claims were expired you’ll be surprised to learn they’re not. You can still make a claim for mis-sold PPI under the Plevin ruling. However your claim will be focused on the undisclosed commission taken when you took out PPI.
Plevin PPI tax refunds target financial companies who carved off more than half the costs customers paid for PPI in commission.
The practice was widespread across the financial industry from the 90s to mid-noughties.
Involving everyone from well-known credit card companies to mortgage lenders and loan providers, there are still many customers across the UK who are entitled to compensation.
If the commission split was never explained to you, you could be entitled to make a claim for a Plevin PPI tax refund.
To date, payment protection insurance pay-outs made via Plevin claims have seen recipients earn upwards of £1000, with some pay-outs totalling tens of thousands. The biggest claim to date? £40,000.
Here’s all you need to know about PPI tax refunds, what they are, who can make a claim and how to make one.
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I’ll use the following questions to explore the topic in more detail:
- What is the Plevin PPI tax refund?
- How is a Plevin PPI claim different to PPI?
- How long do I have to apply for a Plevin PPI tax refund?
- Who is eligible for a PPI tax refund?
- How do I make a claim for a Plevin PPI tax refund?
What is The Plevin PPI Tax Refund?
The Plevin PPI tax refund, also known as a Plevin PPI claim, is a new way for customers to reclaim payments made for PPI sold to them in a misleading manner.
First paid out to Susan Plevin in 2014, Plevin PPI claims are centred on the way companies gained commission from the PPI they mis-sold to customers.
Frequently generated through hard-selling tactics, the FCA has stated that customers who paid PPI raised through concealed commission can make a claim under the Plevin Supreme Court Ruling of 2014.
The 2014 Plevin Ruling saw Susan Plevin win a case taken to the Supreme Court for the 71.8% commission she had paid to Paragon Personal Finance for a loan, without knowing. The Supreme Court ruled both the high proportion of commission and the concealed charge for the commission were unfair.
The terms of the 1974 Consumer Credit Act make hidden PPI commission unlawful because it was taken without the customer knowing.
What is PPI?
PPI or Payment Protection Insurance, was sold as part of popular financial products, such as mortgages and credit cards.
Originally intended as a type of insurance cover, PPI should have offered customers protection against unforeseen circumstances which would affect their capacity to keep up with monthly repayments, such as ill health or a job loss.
PPI was often presented to the customer as an inclusive part of the financial product or included in repayments without the customer knowing. In some cases, payment protection insurance was even sold to customers as an obligatory product they had to have. Learn more about PPI in our complete guide to payment protection insurance.
How Is A Plevin PPI Claim Different To PPI?
Many customers made a claim for PPI mis-sold to them prior to the mid-noughties. Following widespread complaints by consumer groups, the Financial Conduct Authority (FCA) banned PPI in 2009 after finding it had been sold to customers in a manner that was misleading.
Consumers across the UK were given until the 29th of August 2019 to claim back payments for mis-sold PPI payments. According to the FCA over £33bn was repaid to customers who made successful claims.
However, the FCA estimates around 64 million people were mis-sold PPI up to 2005. In fact, some misleading PPI policies were found to stretch as back as far as the 1970s.
Spanning a wide range of financial products that were designed to be paid off in instalments, there are still lots of UK customers who haven’t claimed back what they are owed.
Plevin PPI claims make it possible for consumers who still want to make a PPI claim, post-2019, to do so. Claims made under the Plevin ruling are still valid even though the expiry date for general PPI claims has now passed.
How Long Do I Have to Apply for a Plevin PPI Tax Refund?
Unlike general PPI claims which ended in 2019, Plevin PPI tax refunds are open-ended because they are sought under the terms of the Consumer Credit Act of 1974.
However, as with all claims, it’s always best to apply as soon as possible because you never know when amendments could be made which may affect your eligibility to be entitled to a repayment from your lender.
The process to make a PPI claim can take anything from 2 months to as much as 12 months if you decide to pursue your claim in court. Court proceedings are at the top of the scale with a larger quantity of customers pursuing Plevin claims directly with their lender.
In the first instance, communications are always with lenders who are by now, well prepared to accommodate legitimate claims of malpractice. No company wants to be associated with fraud so most Plevin claims can be settled within a few months.
If your lender doesn’t co-operate, rejects your claim or leaves you feeling dissatisfied, you can then involve the Financial Ombudsman Service. The final port of call if you are still unhappy is legal action.
Who is Eligible For a PPI Tax Refund?
The key issue for a Plevin PPI refund is that the composition of the PPI commission you paid wasn’t clearly explained to you.
The details of financial product payments were seriously cleaned up after 2005 but you can still make a claim for products sold after 2005. Most PPI claimants span the period from 1990 to 2005 but a smaller number of consumers have claimed for PPI paid for financial products sold before and after that period.
To be eligible to make a claim under the 2014 Plevin ruling, the commission referred to in your claim should total more than half your PPI costs. The commission should have been received by your lender or your lender and broker.
Remember this commission percentage must not have been explained to you by the broker or lender for you to be eligible to make a Plevin PPI claim. Your lender may even have been your bank. Whoever the provider, if they didn’t tell you about the commission you paid them, you can make a claim.
Unlike general PPI claims, Plevin PPI claims are made against the commission you paid without knowing that means customers who previously made unsuccessful claims for PPI they were mis-sold are eligible to make a new claim for Plevin PPI.
If you already received a pay-out for PPI you are unlikely to be eligible to make a claim.