Actions to take for interest received gross prior to revoking R85?

firsttimestudent

Hi all,

I was chatting to a friend of mine. Basically the story is, she graduated from university on Jul 2010. There was a period of being unemployed while looking for jobs and she finally got her job in November. As soon as she got the job, she went to her bank to revoke her R85. At that time, she thought that was it.

However, she just recently realised that things work on a 'tax-year basis' (as in not per calender year) and technically, she owed HMRC the interest earned before she revoked the R85 from Apr to Oct.

The amount won't be much (the gross interest she has earned will probably be about £50).

I wasn't familiar with tax, so should she go and contact HMRC about repaying the tax? Or will HMRC disregard it since it really is a small amount?

Thanks for any advice!

Mikeyorks

Unless she has other reason for contacting HMRC, I would ignore it. The tax due is circa £10 - assuming she's a basic rate payer - and the friction costs of dealing with that exceeds any benefit.

A few Banks both apply and de-apply R85s retrospectively. In other words they will add / remove the 20% tax for interest payments already made in the tax year. Most Banks don't ...... and HMRC no longer carry a list.

Worth checking back on statements ..... but not worth doing any more than that.