Tax status and 12 Month or Less Fixed Rate Bonds

runawaytrain

Hi,

Did you know that from this year, that these bonds will have the interest paid Gross and not Net, if the total investment including the interest is £50,000 or more, whether a single or joint account.

That will mean filling out a lengthy tax form for each one, which I can tell you is a pain.:mad:

These accounts are now termed a Qualifying Time Deposit (QDT), and the joke is if you were to invest £48,000 at 4% twice for a year, the interest would be paid net, even though the total is over £96,000, because neither would breach the £50,000 ceiling.:rotfl:

I did try and get confirmation from HMRC but they refused to comment on Data Protection Grounds.

Does anyone else have any info or comments about this?

noh

It's not new.
See Income Tax Act 2007 Section 866
http://www.opsi.gov.uk/Acts/acts2007/ukpga_20070003_en_47

It applies to fixed rate accounts up to 5 years duration which have to meet other criteria as well as the £50000 deposit to be QTDs.
More info here :- http://www.hmrc.gov.uk/tdsi/mailshot31.htm



Don't actually see what the problem is.

MagicBurd29

Despite several minutes rummaging around the web, I can't see how you pay the tax on QTDs to HMRC - this on behalf of my mother, for whom I have PoA - she hasn't needed to submit a tax return for several years. Do I have to organise a tax return this year? Or is there another kind of form to complete?

Thanks in anticipation.