tax allowance on Savings

simmey

Hi,

I have recently retired and am wondering how I claim my tax allowance on savings, I know I can advise my bank and they will deduct the tax at source but what about a savings bond I have had for 2 years with a large amount of money in (which I was advised at the time of taking out it wasn't suitable for non tax payers and wasn't planning on retiring then). And what if my interest is more than my tax allowance?

Anyone out there who is claiming their tax back?

jem16

If you have income of over £6035 then you are a taxpayer. It doesn't matter if this is earned income or income from savings interest.

The only difference between earned income and savings income is that if it's savings income the first £2320 above the £6035 is taxed at 10%. After that it's 20%.

fengirl_2

To answer your specific question, assuming you dont have a company pension, you claim your tax back on your interest through your local tax office using form R40.

simmey

I do have a company pension although it isn't much as I have retired 10 years early, so do I claim back through my pension via the company payroll?

simmey

P.S. thanks for your replies

lcharm

I'm not sure which way is more practical but you could also complete an R85 so that they stop deducting tax at source and just complete your self assessment for the future.

johnllew

lcharm wrote: »

I'm not sure which way is more practical but you could also complete an R85 so that they stop deducting tax at source and just complete your self assessment for the future.

An R85 is not appropriate if you are a taxpayer. You can only use this form if you are sure your total income is less than your personal allowance.

http://www.hmrc.gov.uk/forms/R85.pdf

fengirl_2

You need to claim through the tax office which deals with your company pension.