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Tax payable on HSBC PPI refund?
pharmer_2
Posts: 10 Forumite
Last year I received a PPI refund (eventually after about 9 months) from HSBC on 3 loans I had had between 2002 and 2007. In the letter it stated I would have to declare this as income in the 2009-2010 tax year and tax would be payable on this amount. As this was (in theory) my money to start with, should I need to pay tax on the whole amount of the refund, or just the 8% statutory interest they included in the refund? Given the refund was about £4600, this could be quite a sum, even though I could offset this against other income. Can anyone comment? Thanks
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Last year I received a PPI refund (eventually after about 9 months) from HSBC on 3 loans I had had between 2002 and 2007. In the letter it stated I would have to declare this as income in the 2009-2010 tax year and tax would be payable on this amount. As this was (in theory) my money to start with, should I need to pay tax on the whole amount of the refund, or just the 8% statutory interest they included in the refund? Given the refund was about £4600, this could be quite a sum, even though I could offset this against other income. Can anyone comment? Thanks
Hi there
Not so sure to be honest, maybe Dunstonh will have some advice for you on this one, but I thought the tax would have been sorted before they issue the refund, I could be wrong though, I'm sure someone will know this answer, good luck.;)The one and only "Dizzy Di"
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Last year I received a PPI refund (eventually after about 9 months) from HSBC on 3 loans I had had between 2002 and 2007. In the letter it stated I would have to declare this as income in the 2009-2010 tax year and tax would be payable on this amount. As this was (in theory) my money to start with, should I need to pay tax on the whole amount of the refund, or just the 8% statutory interest they included in the refund? Given the refund was about £4600, this could be quite a sum, even though I could offset this against other income. Can anyone comment? Thanks
It is only the 8% interest that you would be taxed on at basic rate tax.0 -
dec22 beat me to it. Interest is taxable. You can claim the tax back if you are a non taxpayer and if you are a higher rate taxpayer you will have to pay an additional 20%.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0
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Thanks to you all for your quick response - one less thing to worry about - just 4,999,999 left to go - pharmer0
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