Huey
Thats the way it works, the fact you only received say £3k of a £5k FRI is your problem according to the MOD. The MOD paid you a £5K FRI, YOU paid the taxman the £2K. Simple as that!!
I was told that if I had to pay my FRI back then, just like my LSAP, it would be paid back out of my gratuity at the end of my service.
As I said, I didn't actually have to pay my FRI back and things may have changed since last year!!