Help with this taxing question....please!

jennifernil

Ah, yes, good point! The hope of a return to higher rates is why I still have ISAs!


To the OP........I hope you are both using ISAs too?

jennifernil

Looking at this on HMRC website.................





" Income above a certain level from savings, investment or property

If you don't already complete a tax return, you'll need to do so if you receive any of the following:

• income from savings and investments of £10,000 or more
• income from untaxed savings and investments of £2,500 or more
• income from property (before deducting allowable expenses) of £10,000 or more
• income from property (after deducting allowable expenses) of £2,500 or more
• annual trust or settlement income on which tax is still due (even if you’re only treated as receiving this income)
• income from the estate of a deceased person on which tax is still due " ..................

has me worried now, as my untaxed bank interest last year and this year was/is over £2500! But my state pension is only £50.90 p/w, so I am still well below my personal allowance. I have used R40 for 2 years now (to reclaim the £1.25 on the HBOS Rewards plus tax on a couple of accounts that refused/messed up my R85), and HMRC have sent my refund without comment. Even enclosed my next R40!

Should I worry?

Is............" income from untaxed savings "..........the same as " untaxed income from savings " ?

Mikeyorks

jennifernil wrote: »

Should I worry?

No ..... not if it's as a consequence of filing an R85(s)?

The £2500 relates to interest always paid gross from eg NS&I and special accounts over £50k (I've forgotten the name of them! ) EDIT ..... Qualifying Time Deposit .... as exampled here :
http://www.angloirishbank.co.uk/Personal_Savings/FAQ/FAQ_for_Qualifying_Time_Deposits/

jennifernil

Phew!

Yes, I understand what you are referring to, I do not have any accounts like that, just untaxed interest due to the R85s.

adewalton

hi agian,

i have had a chat with my accountant friend and it turns out i may have not understood this right!!
we did not take our private pensions till after the 6th of April 2010, same with the state pension so this is why we have been getting a refund i think as it would only be the interest on savings that counts towards the allowance so i understand.

this next tax year 2010 - 2011 will be diffrent as the state and private pensions will count too!!!

so if i am right in saying we need to leave our interest paid with tax taken at source???

comments please guys???

is this right, do i have it correct?

thanks in advance,

Mikeyorks

adewalton wrote: »

so if i am right in saying we need to leave our interest paid with tax taken at source???

I'm afraid you do. The State Pension fully counts this year. Even if the private pensions were taken part way through the year ..... you could only file an R85 up to April. Which is rather pointless.

From the figures you've given - your wife (when we add back the 13th State Pension payment - which I feel you excluded) will remain a taxpayer. As the pensions are likely to be enhanced from April and that will take up the slack when the personal allowance increases in the same month. You're a taxpayer in any event - so can't file an R85.

The 'tax' thing is not your forte! So stay with your accountant / friend for filing the returns.