My 2 year olds account is being taxed

GC81

Hi,
Just getting my account books out to update my saving accounts (update intrest etc) and noticed that my girl's Norwich & Peterborough Headstart Account has been taxed since it was first opened! (august 2006)
I am going into a branch today as surely she shouldnt be taxed on it??
My eldest has got the same type of account, well the 2001 version, and hasnt been taxed on hers.

maybe this is the wrong type of account for them??
dd1 has £800+ and dd2 £300

tanith

I think I remember having apply for taxfree status (can't remember exactly what it was called) when we opened an account for my grandson at Halifax.. we were asked when we opened the account...

Baldur

You need to submit Form R85 to receive tax-free interest on savings.

martinman3

Baldur wrote: »

You need to submit Form R85 to receive tax-free interest on savings.

That will ensure that future interest is not taxed but OP will also need to fill in a R40 to claim back tax paid to date. Links to form and notes below.

http://www.hmrc.gov.uk/forms/r40.pdf

http://www.hmrc.gov.uk/forms/r40notes.pdf

GC81

Thanks for the swift replies.

I'm pretty sure that we filled in forms as we specifically open it as a childs savings account. Will go in and see them as they may have better accounts for them now anyway.

Thanks again

bryanb

There is no lower age limit on income tax, if a child has income it's taxable when greater than the tax free allowance. You have to declare on R85 if it's not applicable. as others have said.

dunstonh

You are a potential taxpayer from the day you born to the day you die. Age doesnt matter. You have to declare you are not a taxpayer (or the child isnt).

theGrinch

gordon brown piggy bank raider. that man will do anything

you need the R85

withnell

It's always been this way - there are many children with huge investments in their names who have to pay tax!