Now rubbing salt into the wounds, millions of consumers across the country have been told they will be forced to pay tax on the refunds they received from banks after being wrongfully sold Payment Protection Insurance (PPI).
The victims of the recent financial scandal are being expected to have to pay a sum of £350million to the Treasury. Although the average tax payment is set to be around £50 per person, some could end up paying out thousands.
PPI as a product is not bad, if it is sold to the correct people and in the correct way. The insurance is sold with credit cards and personal loans, to cover repayments if the individual becomes too ill to work or becomes jobless. In many cases, it has come to light, banks and other sales persons have targeted pensioners, stay at home mothers, the self-employed and those all ready with health problem – all of which who would not be able to claim. Others, however, have been targeting anyone and everyone, but not informing them that they either do not need the product if they don’t wish, or have sold it without their knowledge.
The Government is now coming under fire after stating the 8% interest for the time the banks wrongfully kept their clients money, which is claimed back along with up to six years worth of payments, shall be taxed. If the interest is taxed at the basic 20% rate, the Government shall be receiving a generous amount depending on the size of the refund.
Consumer groups have been calling for the banks to pay the bill – no surprise as they have already taken plenty of money and now consumers are fighting back; the banks still get to keep a lump sum for themselves.
Sally Bowyer, Managing Director of financial claims specialist BrunelFranklin.com says that the public are slowly becoming wiser to the tactics of mis-selling, but that a lot of the damage is already done: “It is important to realise that we may all unwittingly have taken out PPI during the years when lenders were offering a seemingly endless line of credit in the form of loans and credit cards in particular. It costs nothing to check your paperwork for insurances that you may not even know you are paying for. PPI per se is not a bad product; however the onus is on the vendor to ensure the product is the best for your needs at the time of sale. If the best product for your needs was not offered, or if you were unaware of the true cost, for example, you may have grounds for a refund.”
Learn more about PPI refunds and find out if you could apply for a refund today! Visit the website www.brunelfranklin.com or call Brunel Franklin, free, on 0800 051 54 51.