Tax on my interest from my savings

koolcat

Hi fellow moneysavingexperts. Im a bit confusted about my tax situation. I have quite a large sum of money (about 100k). I have been unemployed since end Sept 2008 and getting contribution based JSA. My employer was oviously paying my tax and my code was 603L.

My sal was 30k pa. So in this financial year I have earned 15k (April to September).

My question is will I be able to complete a R85 tax form to receive my interest on my savings gross?

When I called the tax office I was told that only the first £6035 per year is tax free and that any other surplus is taxable in a financial year. Is this correct? Will I have to pay tax on my interest from savings?

Lokolo

Yes that is correct. You will have to pay tax on savings interest if you earn over your personal allowance.

Wookey

This tax year you will most likely be paying 20% tax on savings except ISA's, from next tax year if you are still unemployed then a small rebate may be possible dependent on what interest rate you receive on savings (except ISA's) combined with any JSA benefits paid. I'm fairly sure the tax office will want to be sure you won't earn over the 6k personal allowance threshold before granting a tax exemption, should you receive an exemption and then go over the 6k allowance then you will need to pay back the difference.

koolcat

Thanks for the confirmations. Looks like I will be paying tax, even though I really hate paying it.