Tens of thousands of retirees received refunds averaging £3,342 last year after being overtaxed on their pension withdrawals, new figures show.

Around 60,000 people claimed back overpaid pension tax in 2023-24, an increase of 20 per cent on the previous year, according to data from HMRC, obtained via a Freedom of Information request by Royal London.

Of those, around 2,400 people claimed back more than £10,000 in tax, while the top 25 refunds averaged £106,897 each.

Over half a million people have been forced to claim back overpaid tax on their pensions since 2015, with the total amount refunded approaching £1.5bn.

Pension freedoms, introduced in 2015, allow people aged 55 and over to withdraw some or all of their defined contribution (DC) pensions – where you save up a pot of mon

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