savings problem

almostemptynest

I have had savings in the IOM for 11 years but the bank is now closing and have written to say they are sending me a cheque. The problem is that I never declared that I had this money when claiming Tax credits - it was was rainy day money put away so that I wouldn't be tempted to spend it. I have paid retention tax on it but what happens now if I try to lodge it into my uk account ? Any info gratefully received - worried esp about the Tax credit end of things ?

opinions4u

You're failure to declare the capital sum and interest is almost certainly illegal.

Employ an accountant. They will advise you of your tax and penalty payments liability. You may yet need a solicitor to keep you out of prison.

LongTermLurker

Isn't there a reciprocal agreement between IOM and UK whereby the IOM banks still inform HMRC of income? That being the case, HMRC would already know about the income and wouldn't be happy about you not declaring it yourself.

I don't know what the requirements for tax credits are, but assume you declare how much capital & income you have? If you haven't declared the IOM capital and income, then you have defrauded the system, and I suspect that's even more of a problem than not informing HMRC of the income?

I admit to being clueless in these matters, so what I've said could be completely wrong - they're just my suspicions.

saving-mad

i am no expert but as far as i am aware the tax credits are not interested in how much money you have in the bank, they ask how much interest you get, if this is more than £300 you should have declared it,
i am sure they have bigger fish to fry but if you have done wrong you have a chance of getting caught and face the consequences, once back in a UK account could you not put it in an ISA or premium bonds where the tax credits aren't interested?

almostemptynest

Thanks for that - the interest last year was about £550. I realise I should have declared it but I am no longer claiming tax credit so can't do so for this year. If I put it in a uk isa surely the same questions will be asked - don't banks inform HMRC of large deposits from the IOM ? The amount in question is just under £17k. All help gratefully received.