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R85
Former_MSE_Dan
Posts: 1,593 Forumite
in Cutting tax
THREAD RE-POSTED FROM OLD CHAT FORUM. PLEASE CLICK REPLY TO CONTINUE DISCUSSION
As my wife no longer earns she can get interest from accounts tax free using the form R85 for each account. Has anyone any advice/experience of dealing with this form?
I've probably missed the answer somewhere else on the site but at 4 in the morning the eyes tend to miss the obvious.
(Insert from Martin: THe R85 form is the form that means you'll be paid interest gross, that is before tax. Anyone, adult or child needs to sign this form if you're not a taxpayer. If you don't sign it - you will have to reclaim the tax later, it's far better to get it upfront, it's available from most banks or building societies. So ask whomever you have the account with)
As my wife no longer earns she can get interest from accounts tax free using the form R85 for each account. Has anyone any advice/experience of dealing with this form?
I've probably missed the answer somewhere else on the site but at 4 in the morning the eyes tend to miss the obvious.
(Insert from Martin: THe R85 form is the form that means you'll be paid interest gross, that is before tax. Anyone, adult or child needs to sign this form if you're not a taxpayer. If you don't sign it - you will have to reclaim the tax later, it's far better to get it upfront, it's available from most banks or building societies. So ask whomever you have the account with)
Former MSE team member
0
Comments
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There are helpful notes here and you can print off an R85: http://www.inlandrevenue.gov.uk/forms/r85.pdf0
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What happens when you have a joint bank account and I pay tax and my wife doesn`t how will the r85 work.A wise man changes his mind, a fool never will.
El sabio muda el consejo, el necio no.0 -
it splits the interest 50/50 gross/netI am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0
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Thank you.A wise man changes his mind, a fool never will.
El sabio muda el consejo, el necio no.0 -
I have an amount of savings in a cahoot account earning interest at the gross rate. I am also about to embark on stoozing.
On top of this, I have been asked by my former employer to do some occasional project work from home for them. At this stage I have no idea how much work there will be.
I have therefore completed R85 for the cahoot account.
My question is that should my earnings plus interest earned on savings reach £4745, what happens then? I take it I have to inform cahoot, but what happens to the interest I've earned up to that point?
I assume I will pay tax from that point on and the interest I've earned to that point is unaffected, but would be grateful for confirmation.0 -
you wont need to inform cahoot.... but you will need to assess how much you earnt during the previous working year and then inform the inland revenue..... if you havent already informed them.....smile --- it makes people wonder what you are up to....
:cool:0 -
I have recently turned 25 and as such, I have taken possesion of the trust fund my grandmother set up for me when I was born. I am saving this money in an easy access account.
I am a student and so do not have an income high enough to pay tax, so was going to fill in an R85 to avoid tax on the interest, but it suddenly occured to me that when the trust money transfered into my name (during this tax year) that this would count as income and so send me over the limit to not pay tax!? Is this right or am I still ok to not pay tax? I am a little confused!
Any help much appreciated :T :T :T0 -
Income should include interest and dividends. If this has taken you over the limit, then yes, you are a taxpayer.
However, it depends on where you have the funds invested currently. Certain places are exempt from tax or have the tax dealt with differently so not to impact on your allowances.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
It is not interest or dividends from this year that have taken me over the limit, but the fact that the whole investment has come into my name a couple of months ago.
The fund was managed investments in a number of different areas, mainly stock market. On my birthday all shares etc. were sold and the cash paid to me. Does this count?
Thanks so much for your help!0 -
The lump sum itself does not make you a taxpayer. The income distributions within the fund is what potentially does that.
Depending on what investment wrapper the investment is within, will depend on how the tax is dealt with. i.e. investment bond would have no income tax liability to you at this stage. OEIC/Unit Trust would have distributions which are taxed at source but do count towards your income.
So, the important question is; what investment tax wrapper is it? (bond, unit trust, OEIC, investment trust etc)I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0
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