First Time Tax Return

Kavanne

At the end of this financial year, I think I will have to fill out a self assessment tax return.

This is because I have an account which pays interest gross and I know the interest paid out will be over my personal allowance. So do I have to fill in a tax return to see the tax I pay on this?

I pay tax on all other investments before it gets to me, so will there be a separate spaces on the form in which to separate the taxed income from non-taxed?

Thanks for helping a confused newbie.

Robert_Sterling

Yes you should inform tax office of your untaxed income.

Kavanne

Robert_Sterling wrote:

Yes you should inform tax office of your untaxed income.

I definitely will do that, I am just wondering whether the form is on my side or whether because I have both taxed and untaxed income coming in, it will be a problem for me.

ctm_2

It's unlikely that you will have to complete a tax return (for clarification a 'tax return' is a Self Assessment Tax Return, and no other form) as such, but you may be asked to complete another type of form, probably a Review Form (P810) every few years so that a deduction can be included in your tax code for the untaxed interest.

The only circumstances where you would be required to complete an actual tax return is if the investment income is your only income (i.e you don't have any jobs or pensions from which any additional tax could be collected). In that case all you would have to complete of the form anyway is the first page showing the interes, then your name etc on another page, then sign and date it. All the rest could probably be ignored.

Kavanne

ctm wrote:

The only circumstances where you would be required to complete an actual tax return is if the investment income is your only income (i.e you don't have any jobs or pensions from which any additional tax could be collected). In that case all you would have to complete of the form anyway is the first page showing the interes, then your name etc on another page, then sign and date it. All the rest could probably be ignored.

Yeah, I'm a student so the investment income is all I have.

Ok, that sounds simple enough. Thanks!

Aark

This is because I have an account which pays interest gross

Is this just a normal savings account or is there a reason for it paying interest without tax deducted?

This is because I have an account which pays interest gross and I know the interest paid out will be over my personal allowance. So do I have to fill in a tax return to see the tax I pay on this?

I pay tax on all other investments before it gets to me

Do you mean the interest received gross is more than the personal allowance on its own, or that your total income is now over the personal allowance?

Depending on how much the interest received gross is and your total income, you might have tax to pay or tax repayable.

Does this mean that in previous tax years your income was below the personal allowance and tax was being deducted from some of your interest?

Kavanne

Aark wrote:

Is this just a normal savings account or is there a reason for it paying interest without tax deducted?

It's a 'Money Market Deposit', no idea why it pays gross.

Do you mean the interest received gross is more than the personal allowance on its own, or that your total income is now over the personal allowance?

Does this mean that in previous tax years your income was below the personal allowance and tax was being deducted from some of your interest?

The interest received gross on this one account will be over my personal allowance.

I have only opened it recently and in past years I have only had accounts that paid interest net, so never needed to pay any extra tax because the bank already took it from me.

In previous years all my interest had had tax deducted, could I claim some of this back? It will go back 2 years to when I was 16. I'm not sure I have all my tax certificates though..

ctm_2

Kavanne wrote:

In previous years all my interest had had tax deducted, could I claim some of this back? It will go back 2 years to when I was 16. I'm not sure I have all my tax certificates though..

yes, if your total income was below the personal allowance, then yes, you can claim the tax back.

You will need to fill in an R40 for each year. If you don't have the interest certificates, you should be able to get a replacement statement showing the total interest paid in each year and the tax deducted.

i am assuming here that this is your only account, and this is your total income for the year. If you have other sources of income, wether they are taxed or not, they need to be included to work out your total liability/refund.

Kavanne

ctm wrote:

yes, if your total income was below the personal allowance, then yes, you can claim the tax back.

You will need to fill in an R40 for each year. If you don't have the interest certificates, you should be able to get a replacement statement showing the total interest paid in each year and the tax deducted.

i am assuming here that this is your only account, and this is your total income for the year. If you have other sources of income, wether they are taxed or not, they need to be included to work out your total liability/refund.

My total income was above the personal allowance, but all of it was taxed. So can I not claim tax back on the first ~£4K?

ctm_2

Ok, I was assuming that this one account was your only income.

You get your personal allowance, which this year is £5035. That is how much income you can have before you pay tax. You then pay tax on all amounts OVER the personal allowance at varying rates. Last year the personal allowance was £4895.

I suggest that you get together the details of all of your income for the past few years, and write a letter to your tax office with those details (always keep a photocopy of any original documents) and ask for them to check the amount fo tax you have paid.

Kavanne

Right, ctm, thanks!