£5k starting rate for savings

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24

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  • kidmugsy
    kidmugsy Posts: 12,709 Forumite
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    ANGLICANPAT wrote: »
    I dont understand why the £73.80 tax isnt covered by what remained from the £5000 savings starting point that is talked about.

    I put it to you, m'Lud, that it's because the complexity of the tax system can defeat even those paid to apply it.
    Free the dunston one next time too.
  • ANGLICANPAT
    ANGLICANPAT Posts: 1,444 Forumite
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    Thank you ! Thank goodness for that ! Im not used to being right about ANYTHING to do with numbers , so was dreading there being another layer of tax rules involved which I hadnt understood or applied.
    So am I best just writing a letter to them , pointing the error out, or sending a cheque with the letter and leaving it to them to look at it and do a refund?
  • Dazed_and_confused
    Dazed_and_confused Posts: 6,458 Forumite
    Uniform Washer
    edited 17 November 2017 at 9:57PM
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    I disagree with capital one, although it may simply be a matter of interpretation. Anyhow, not everyone on standard tax rate or below can get the £1000 Personal Savings Allowance.

    ANGLICAN PAT

    From what you've posted you cannot benefit from the Personal Savings Allowance.

    And your calculation lacks enough detail to know if it is correct or not.

    What is the Total Income received £12,375 made up of i.e. pension income amount, wages amount, dividend amount etc etc.

    And what type of calculation is it, Self Assessment or something else?
  • ANGLICANPAT
    ANGLICANPAT Posts: 1,444 Forumite
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    Self assessment.
    £6110 prop rental
    £4295 pension
    £6 divi
    £1964 savings
  • Dazed_and_confused
    Dazed_and_confused Posts: 6,458 Forumite
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    Ok, you aren't able to get the Personal Savings Allowance.

    Rents and pension (£10405) don't get taxed as less than Personal Allowance (£11000).

    Savings interest is partly covered by the remainder of the Personal Allowance (£595) which leaves £1369 to be taxed. This would be taxed at the savings starter rate of 0% so no actual tax due.

    Dividends are all to be taxed but at the Dividend "allowance" rate of 0% so again no tax actually payable on this income.

    What does your savings income actually consist of and where did you enter it in your tax return?

    What does your tax calculation show as the individual income elements, is it the same as your latest post?
  • ANGLICANPAT
    ANGLICANPAT Posts: 1,444 Forumite
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    edited 17 November 2017 at 11:17PM
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    "What does your tax calculation show as the individual income elements, is it the same as your latest post?" Yes
    The savings are all gross amount from BS's , Banks, and NS&I put into the short tax assessment in the place it asks for gross savings

    So are you saying Im not due to pay any tax as it happens, but wouldnt get the £1000 personal savings anyway for some reason ? Which HMRS link helps me work all this out for myself ?
  • Dazed_and_confused
    Dazed_and_confused Posts: 6,458 Forumite
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    You have fallen foul of an error with HMRC's self assessment calculations.

    You will have to contact them and ask them to correct the calculation as it is an exclusion ID 51 case.

    The link below explains this - the details you have provided match ID 51.

    Basically you have been given the Personal Savings Allowance rate band when you are not entitled to it. You should have got the starter savings rate band.

    https://www.rossmartin.co.uk/sme-tax-news/2634-software-specification-error-affects-2016-17-self-assessment
  • Dazed_and_confused
    Dazed_and_confused Posts: 6,458 Forumite
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    So are you saying Im not due to pay any tax as it happens, but wouldnt get the £1000 personal savings anyway for some reason ?

    Correct. You cannot get the Personal Savings Allowance on such on a low income.

    Which HMRS link helps me work all this out for myself ?

    Does this link help? It puts the relevant elements into order.

    https://www.gov.uk/apply-tax-free-interest-on-savings
  • ANGLICANPAT
    ANGLICANPAT Posts: 1,444 Forumite
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    Thank you Dazed, I will contact them. The HRMC crock up must still be going on . Your link to the tax advisors notification says its an online problem and should be sorted by Oct. I submitted hard copy on 26th Oct , and mines wrong , so presumably its still going on . Is their crock up common public knowledge? Ive not heard anything till I read your link.
  • Dazed_and_confused
    Dazed_and_confused Posts: 6,458 Forumite
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    Fairly common to tax professionals. There have been quite a few posts on here which mention it but mainly on the Cutting Tax board rather than here on Savings and Investments.
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