diff --git a/CHANGELOG.md b/CHANGELOG.md
index 78c621b9..12ed4347 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -10,6 +10,7 @@ to [Semantic Versioning](https://semver.org/spec/v2.0.0.html).
 ### Added
 
 - Support for `hosted_page` on payment creation (`return_uri`, `country_code`, `language_code`, `max_wait_for_result`), exposing `getHostedPageUri()` on the created payment
+- Support for the `payout_attempt_failed` webhook
 
 ## [3.3.0] - 2025-09-17
 
diff --git a/README.md b/README.md
index d9355a75..c6af7ba8 100644
--- a/README.md
+++ b/README.md
@@ -1184,6 +1184,7 @@ This library supports handlers for the following event types:
 - refund_failed
 - payout_executed
 - payout_failed
+- payout_attempt_failed
 
 You can also handle other event types by typehinting `TrueLayer\Interfaces\Webhook\EventInterface`
 in your handler. You can then get the payload data by calling the `getBody()` method on your variable.
@@ -1301,6 +1302,20 @@ $client->webhook()
         $event->getFailedAt();
         $event->getFailureReason();
     })
+    ->handler(function (Webhook\PayoutAttemptFailedEventInterface $event) {
+        // handle payout attempt failed
+        // Sent when a payout attempt fails but will be retried. Only available if payout retries are enabled.
+        // Inherits from PayoutEventInterface so provides same methods plus:
+        $event->getFailedAt();
+        $event->getFailureReason();
+        $event->getSchemeId();
+
+        $retry = $event->getRetry();
+        $retry->getAttemptsMade();
+        $retry->getAttemptsRemaining();
+        $retry->isScheduledForRerouting();
+        $retry->getNextAttemptAt();
+    })
     ->execute();
 ```
 
diff --git a/config/bindings.php b/config/bindings.php
index 11e577ab..8f487004 100644
--- a/config/bindings.php
+++ b/config/bindings.php
@@ -104,6 +104,8 @@
     Interfaces\Webhook\RefundFailedEventInterface::class => Entities\Webhook\RefundFailedEvent::class,
     Interfaces\Webhook\PayoutExecutedEventInterface::class => Entities\Webhook\PayoutExecutedEvent::class,
     Interfaces\Webhook\PayoutFailedEventInterface::class => Entities\Webhook\PayoutFailedEvent::class,
+    Interfaces\Webhook\PayoutAttemptFailedEventInterface::class => Entities\Webhook\PayoutAttemptFailedEvent::class,
+    Interfaces\Webhook\PayoutAttemptFailedRetryInterface::class => Entities\Webhook\PayoutAttemptFailedRetry::class,
     Interfaces\Webhook\PaymentMethod\BankTransferPaymentMethodInterface::class => Entities\Webhook\PaymentMethod\BankTransferPaymentMethod::class,
     Interfaces\Webhook\PaymentMethod\MandatePaymentMethodInterface::class => Entities\Webhook\PaymentMethod\MandatePaymentMethod::class,
     Interfaces\Webhook\Beneficiary\BusinessAccountBeneficiaryInterface::class => Entities\Webhook\Beneficiary\BusinessAccountBeneficiary::class,
diff --git a/config/discriminations.php b/config/discriminations.php
index f5cc23ce..9de103cd 100644
--- a/config/discriminations.php
+++ b/config/discriminations.php
@@ -103,6 +103,7 @@
         WebhookEventTypes::REFUND_FAILED => Interfaces\Webhook\RefundFailedEventInterface::class,
         WebhookEventTypes::PAYOUT_EXECUTED => Interfaces\Webhook\PayoutExecutedEventInterface::class,
         WebhookEventTypes::PAYOUT_FAILED => Interfaces\Webhook\PayoutFailedEventInterface::class,
+        WebhookEventTypes::PAYOUT_ATTEMPT_FAILED => Interfaces\Webhook\PayoutAttemptFailedEventInterface::class,
     ],
     Interfaces\Webhook\PaymentMethod\PaymentMethodInterface::class => [
         'discriminate_on' => 'type',
diff --git a/src/Constants/WebhookEventTypes.php b/src/Constants/WebhookEventTypes.php
index ccef4b24..5dbd6128 100644
--- a/src/Constants/WebhookEventTypes.php
+++ b/src/Constants/WebhookEventTypes.php
@@ -19,4 +19,5 @@ class WebhookEventTypes
 
     public const PAYOUT_EXECUTED = 'payout_executed';
     public const PAYOUT_FAILED = 'payout_failed';
+    public const PAYOUT_ATTEMPT_FAILED = 'payout_attempt_failed';
 }
diff --git a/src/Entities/Webhook/PayoutAttemptFailedEvent.php b/src/Entities/Webhook/PayoutAttemptFailedEvent.php
new file mode 100644
index 00000000..f459a458
--- /dev/null
+++ b/src/Entities/Webhook/PayoutAttemptFailedEvent.php
@@ -0,0 +1,87 @@
+<?php
+
+declare(strict_types=1);
+
+namespace TrueLayer\Entities\Webhook;
+
+use TrueLayer\Interfaces\Webhook\PayoutAttemptFailedEventInterface;
+use TrueLayer\Interfaces\Webhook\PayoutAttemptFailedRetryInterface;
+
+class PayoutAttemptFailedEvent extends PayoutEvent implements PayoutAttemptFailedEventInterface
+{
+    /**
+     * @var \DateTimeInterface
+     */
+    protected \DateTimeInterface $failedAt;
+
+    /**
+     * @var string
+     */
+    protected string $failureReason;
+
+    /**
+     * @var string
+     */
+    protected string $schemeId;
+
+    /**
+     * @var PayoutAttemptFailedRetryInterface
+     */
+    protected PayoutAttemptFailedRetryInterface $retry;
+
+    /**
+     * @return mixed[]
+     */
+    protected function casts(): array
+    {
+        return \array_merge(parent::casts(), [
+            'failed_at' => \DateTimeInterface::class,
+            'retry' => PayoutAttemptFailedRetryInterface::class,
+        ]);
+    }
+
+    /**
+     * @return mixed[]
+     */
+    protected function arrayFields(): array
+    {
+        return \array_merge(parent::arrayFields(), [
+            'failed_at',
+            'failure_reason',
+            'scheme_id',
+            'retry',
+        ]);
+    }
+
+    /**
+     * @return \DateTimeInterface
+     */
+    public function getFailedAt(): \DateTimeInterface
+    {
+        return $this->failedAt;
+    }
+
+    /**
+     * @return string|null
+     */
+    public function getFailureReason(): ?string
+    {
+        return $this->failureReason ?? null;
+    }
+
+    /**
+     * @return string|null
+     */
+    public function getSchemeId(): ?string
+    {
+        return $this->schemeId ?? null;
+    }
+
+    /**
+     * @return PayoutAttemptFailedRetryInterface|null
+     */
+    public function getRetry(): ?PayoutAttemptFailedRetryInterface
+    {
+        return $this->retry ?? null;
+    }
+}
diff --git a/src/Entities/Webhook/PayoutAttemptFailedRetry.php b/src/Entities/Webhook/PayoutAttemptFailedRetry.php
new file mode 100644
index 00000000..e2a844e2
--- /dev/null
+++ b/src/Entities/Webhook/PayoutAttemptFailedRetry.php
@@ -0,0 +1,80 @@
+<?php
+
+declare(strict_types=1);
+
+namespace TrueLayer\Entities\Webhook;
+
+use TrueLayer\Entities\Entity;
+use TrueLayer\Interfaces\Webhook\PayoutAttemptFailedRetryInterface;
+
+final class PayoutAttemptFailedRetry extends Entity implements PayoutAttemptFailedRetryInterface
+{
+    /**
+     * @var int
+     */
+    protected int $attemptsMade;
+
+    /**
+     * @var int
+     */
+    protected int $attemptsRemaining;
+
+    /**
+     * @var bool
+     */
+    protected bool $scheduledForRerouting;
+
+    /**
+     * @var \DateTimeInterface
+     */
+    protected \DateTimeInterface $nextAttemptAt;
+
+    /**
+     * @var string[]
+     */
+    protected array $casts = [
+        'next_attempt_at' => \DateTimeInterface::class,
+    ];
+
+    /**
+     * @var array|string[]
+     */
+    protected array $arrayFields = [
+        'attempts_made',
+        'attempts_remaining',
+        'scheduled_for_rerouting',
+        'next_attempt_at',
+    ];
+
+    /**
+     * @return int
+     */
+    public function getAttemptsMade(): int
+    {
+        return $this->attemptsMade;
+    }
+
+    /**
+     * @return int
+     */
+    public function getAttemptsRemaining(): int
+    {
+        return $this->attemptsRemaining;
+    }
+
+    /**
+     * @return bool
+     */
+    public function isScheduledForRerouting(): bool
+    {
+        return $this->scheduledForRerouting;
+    }
+
+    /**
+     * @return \DateTimeInterface
+     */
+    public function getNextAttemptAt(): \DateTimeInterface
+    {
+        return $this->nextAttemptAt;
+    }
+}
diff --git a/src/Interfaces/Webhook/PayoutAttemptFailedEventInterface.php b/src/Interfaces/Webhook/PayoutAttemptFailedEventInterface.php
new file mode 100644
index 00000000..5b51a625
--- /dev/null
+++ b/src/Interfaces/Webhook/PayoutAttemptFailedEventInterface.php
@@ -0,0 +1,36 @@
+<?php
+
+declare(strict_types=1);
+
+namespace TrueLayer\Interfaces\Webhook;
+
+interface PayoutAttemptFailedEventInterface extends PayoutEventInterface
+{
+    /**
+     * Get the date and time the payout attempt failed.
+     *
+     * @return \DateTimeInterface
+     */
+    public function getFailedAt(): \DateTimeInterface;
+
+    /**
+     * Get the reason the payout attempt failed.
+     *
+     * @return string|null
+     */
+    public function getFailureReason(): ?string;
+
+    /**
+     * Get the unique identifier for the scheme.
+     *
+     * @return string|null
+     */
+    public function getSchemeId(): ?string;
+
+    /**
+     * Get details about the retry attempt.
+     *
+     * @return PayoutAttemptFailedRetryInterface|null
+     */
+    public function getRetry(): ?PayoutAttemptFailedRetryInterface;
+}
diff --git a/src/Interfaces/Webhook/PayoutAttemptFailedRetryInterface.php b/src/Interfaces/Webhook/PayoutAttemptFailedRetryInterface.php
new file mode 100644
index 00000000..876f0114
--- /dev/null
+++ b/src/Interfaces/Webhook/PayoutAttemptFailedRetryInterface.php
@@ -0,0 +1,38 @@
+<?php
+
+declare(strict_types=1);
+
+namespace TrueLayer\Interfaces\Webhook;
+
+use TrueLayer\Interfaces\ArrayableInterface;
+
+interface PayoutAttemptFailedRetryInterface extends ArrayableInterface
+{
+    /**
+     * Get the number of retry attempts that have been made so far.
+     *
+     * @return int
+     */
+    public function getAttemptsMade(): int;
+
+    /**
+     * Get the number of retry attempts remaining.
+     *
+     * @return int
+     */
+    public function getAttemptsRemaining(): int;
+
+    /**
+     * Whether the payout is scheduled for rerouting to a different scheme.
+     *
+     * @return bool
+     */
+    public function isScheduledForRerouting(): bool;
+
+    /**
+     * Get the date and time of the next retry attempt.
+     *
+     * @return \DateTimeInterface
+     */
+    public function getNextAttemptAt(): \DateTimeInterface;
+}
diff --git a/tests/integration/Mocks/WebhookPayload.php b/tests/integration/Mocks/WebhookPayload.php
index a00247d3..79b2f4d5 100644
--- a/tests/integration/Mocks/WebhookPayload.php
+++ b/tests/integration/Mocks/WebhookPayload.php
@@ -352,6 +352,25 @@ public static function payoutFailedWithMetadata(): string
         }';
     }
 
+    public static function payoutAttemptFailed(): string
+    {
+        return '{
+          "type": "payout_attempt_failed",
+          "event_version": 1,
+          "event_id": "b8d4dda0-ff2c-4d77-a6da-4615e4bad941",
+          "payout_id": "0cd1b0f7-71bc-4d24-b209-95259dadcc20",
+          "failed_at": "2021-12-25T15:00:00.000Z",
+          "failure_reason": "scheme_error",
+          "scheme_id": "faster_payments_service",
+          "retry": {
+            "attempts_made": 2,
+            "attempts_remaining": 3,
+            "scheduled_for_rerouting": false,
+            "next_attempt_at": "2021-12-25T16:00:00.000Z"
+          }
+        }';
+    }
+
     public static function payoutExecutedClosedLoop(): string
     {
         return '{
diff --git a/tests/integration/WebhookPayoutHandlersTest.php b/tests/integration/WebhookPayoutHandlersTest.php
index 192aacab..9d5a0931 100644
--- a/tests/integration/WebhookPayoutHandlersTest.php
+++ b/tests/integration/WebhookPayoutHandlersTest.php
@@ -7,6 +7,7 @@
 use TrueLayer\Interfaces\Webhook\Beneficiary\BusinessAccountBeneficiaryInterface;
 use TrueLayer\Interfaces\Webhook\Beneficiary\ExternalAccountBeneficiaryInterface;
 use TrueLayer\Interfaces\Webhook\Beneficiary\PaymentSourceBeneficiaryInterface;
+use TrueLayer\Interfaces\Webhook\PayoutAttemptFailedEventInterface;
 use TrueLayer\Interfaces\Webhook\PayoutEventInterface;
 use TrueLayer\Interfaces\Webhook\PayoutExecutedEventInterface;
 use TrueLayer\Interfaces\Webhook\PayoutFailedEventInterface;
@@ -31,6 +32,7 @@
 })->with([
     'executed' => WebhookPayload::payoutExecuted(),
     'failed' => WebhookPayload::payoutFailed(),
+    'attempt failed' => WebhookPayload::payoutAttemptFailed(),
 ]);
 
 \it('handles payout executed', function () {
@@ -61,6 +63,28 @@
     \expect($event->getType())->toBe('payout_failed');
 });
 
+\it('handles payout attempt failed', function () {
+    /** @var PayoutAttemptFailedEventInterface $event */
+    $event = null;
+
+    \webhook(WebhookPayload::payoutAttemptFailed())->handler(function (PayoutAttemptFailedEventInterface $evt) use (&$event) {
+        $event = $evt;
+    })->execute();
+
+    \expect($event)->toBeInstanceOf(PayoutAttemptFailedEventInterface::class);
+    \expect($event->getType())->toBe('payout_attempt_failed');
+    \expect($event->getFailedAt()->format(DateTime::FORMAT))->toBe('2021-12-25T15:00:00.000000Z');
+    \expect($event->getFailureReason())->toBe('scheme_error');
+    \expect($event->getSchemeId())->toBe('faster_payments_service');
+
+    $retry = $event->getRetry();
+    \expect($retry)->not->toBeNull();
+    \expect($retry->getAttemptsMade())->toBe(2);
+    \expect($retry->getAttemptsRemaining())->toBe(3);
+    \expect($retry->isScheduledForRerouting())->toBeFalse();
+    \expect($retry->getNextAttemptAt()->format(DateTime::FORMAT))->toBe('2021-12-25T16:00:00.000000Z');
+});
+
 \it('handles closed loop payouts', function (string $body) {
     /** @var PayoutEventInterface $event */
     $event = null;
@@ -114,7 +138,6 @@
     'failed, with metadata' => [WebhookPayload::payoutFailedWithMetadata(), ['foo' => 'bar']],
 ]);
 
-
 \it('handles external account payouts', function (string $body) {
     /** @var PayoutEventInterface $event */
     $event = null;