tax status for the ex self employed.

Terrence

Hi all, I was previously self employed for 10 years and after struggling the last 2 years of it with a minimal turnover I eventually lost my livelyhood in September last year with the affect of the recession.

Having saved a moderate amount for my future in the previous years of the business means that I'm not entitled to receive any unemployment support at all whilst I'm looking for work so I've litterally not had a penny for 9 months and I'm relying on my family's support.

I was wondering about the tax status for my savings seeing as I have no income whatsoever, am I still offically a tax payer? I'm unsure as to how it is worked out, is it worked out on the amount earned over your yearly tax allowance?

Many thanks,
Terrence.

MrsManda

You still get your tax free allowance so anything taxable which you earn under £6475 is tax free - earnings income includes some benefits and any interest on savings which are not held in an ISA.
So if you are not earning over £6475 in total over the year you won't get taxed on your savings, if you are earning more than this you will.
Here's a link to more information about how you are taxed on your savings, at what rates but I think it's a bit of a complicated way of explaining

Terrence

Thank-you very much for your very fast reply.

Will I need to obtain some sort of tax exemption document to send to the bank to change my tax status?

MrsManda

Terrence wrote: »

Thank-you very much for your very fast reply.
Will I need to obtain some sort of tax exemption document to send to the bank to change my tax status?

You can fill out an R85 form which you can get either from your bank or download and print off one from the HMRC website HERE
You must make sure that if your income does in the future mean that your earnings go over your tax allowance you tell your bank.