Under the FCA’s final redress scheme rules, published on 30 March 2026, the last date to complain to your lender is 31 August 2027 if it hasn’t contacted you. Complaining earlier put you in the first group dealt with. Reclaiming the tax a lender takes off any compensation has its own deadline: four years from the end of the tax year you are paid.
Update, 3 October 2026: On 2 July 2026 the FCA confirmed that the Upper Tribunal had partly suspended the scheme while it hears four legal challenges. Lenders do not have to calculate or pay compensation until that process ends, and the FCA now expects payments to begin in 2027 at the earliest, if the scheme is upheld and not appealed. The 30 June and 31 August 2026 dates below have passed. Lenders must still send “no compensation” answers on time, but the dates for contacting people who have not complained may change.
Who the scheme covers
The scheme covers car, van and motorbike finance taken out between 6 April 2007 and 1 November 2024. You could be owed compensation if you were not told about a discretionary commission arrangement, a high commission or a contractual tie between the lender and the broker.
The FCA estimates around 12.1 million agreements are eligible, with an average payout of around £830.
The dates that matter
31 May 2026. The pause on lenders handling motor finance complaints, in place since January 2024, lifts.
30 June 2026. The implementation date for agreements taken out from 1 April 2014. If you complain by this date, you are in the first group dealt with.
31 August 2026. The implementation date for agreements from 6 April 2007 to 31 March 2014. See why the 31 August 2026 deadline mattered.
Three months after implementation. Lenders must tell existing complainants whether they are owed compensation and how much.
End of 2026 and end of February 2027. Lenders should contact people who have not complained but are likely to be owed money: by the end of 2026 for loans from April 2014, and by the end of February 2027 for older loans.
31 August 2027. If your lender has not contacted you, this is the last date to complain under the scheme.
Once you get an offer, you have one month to accept it or challenge it. The lender should then pay within one month of you accepting.
Do you need to act now?
If you think you are owed money, complaining sooner rather than later means your complaint is dealt with in the first group. It costs nothing to complain to your lender directly, and you do not need a claims firm. The FCA’s consumer guidance explains how.
If you do nothing, your lender should still contact you if it thinks you are owed compensation. The 31 August 2027 date is a backstop for anyone it misses.
If you are not sure who your lender was, see our guide on how to find your car finance lender.
The tax deadline that comes later
Scheme compensation includes interest, at the Bank of England base rate plus 1% a year (minimum 3%). That interest counts as savings income. Lenders usually deduct basic-rate income tax (22% from 6 April 2027) from it before they pay you.
Many people can reclaim some or all of that tax. As a general guide, non-taxpayers can usually get all of it back, and basic-rate taxpayers up to £200, because of the £1,000 Personal Savings Allowance. Higher-rate taxpayers have a £500 allowance. See our guide for higher-rate taxpayers for how that works.
The deadline for reclaiming is four years from the end of the tax year in which you are paid. So compensation paid in the 2026/27 tax year can be reclaimed until 5 April 2031. The claim is usually made on form R40, or through your Self Assessment return if you file one. Our how it works page explains how we make the claim for you.
Next step
Keep a note of when you complained and any letters from your lender. When compensation arrives, check how much interest was paid and how much tax was taken off. Our calculator gives a quick estimate of what you could reclaim.