Is Halifax Reward classed as interest?

Rob_192

Just filling in my tax return - does anyone know if the £5 per month received on Halifax Reward current accounts is classed as interest? I'm assuming it is, but just wanted to check.

Thanks

R

jem16

Yes it is classed as interest.

sabretoothtigger

Its paid net of basic tax and in theory you can claim back that tax if you come under the annual allowance

opinions4u

sabretoothtigger wrote: »

Its paid net of basic tax and in theory you can claim back that tax if you come under the annual allowance

Or pay more tax if you are a 40% or 50% taxpayer.

Rob_192

Thanks guys, much appreciated.

R

Loughton_Monkey

Quite clear in their terms. You are receiving £6.25 per month, netted down at 20% to £5.00.

cashbackproblems

when do you get this £5 and how long does the 1k need to be in the account? iv just transferred 1k in and nothing showing yet?

hillwalker2004

It is net £5, gross £6.25 as far as I'm aware. So in effect you are paid £6.25 each month but only see £5 on your statement as that is what it is after basic rate tax.

So if you are a 40% tax payer you will have to pay a further £1.25 on top of £1.25 basic rate deduction.

If you a 50% tax payer you will have to pay £1.875 on top of £1.25 basic rate deduction.

If you dont pay tax then I assume you can claim £1.25 back from the taxman - not so sure though on whether Halifax adjust the rate in these instances to gross/net to be £5. Would be surprised if this was the case though.

LittleVoice

QUOTE=hillwalker2004;43607080]

If you dont pay tax then I assume you can claim £1.25 back from the taxman - not so sure though on whether Halifax adjust the rate in these instances to gross/net to be £5. Would be surprised if this was the case though

Halifax pay only the £5 (which is what the advertise they pay). Even if the account holder has registered with them that they are a non-tax payer, Halifax still pay £5.

when do you get this £5 and how long does the 1k need to be in the account? iv just transferred 1k in and nothing showing yet?

It is dated as the first of the month following the one in which you make each £1K deposit. There is no minimum time - people can move money in and straight out again if they want.

hillwalker2004

LittleVoice wrote: »

QUOTE=hillwalker2004;43607080]

Halifax pay only the £5 (which is what the advertise they pay). Even if the account holder has registered with them that they are a non-tax payer, Halifax still pay £5.

Interesting, in which case a non tax payer is technically getting less interest in percentage terms when compared to a tax payer, if both pay in the same amount into the account each month.

LittleVoice

[

QUOTE=hillwalker2004;43607970]

LittleVoice wrote: »

QUOTE=hillwalker2004;43607080]

Halifax pay only the £5 (which is what the advertise they pay). Even if the account holder has registered with them that they are a non-tax payer, Halifax still pay £5.

Interesting, in which case a non tax payer is technically getting less interest in percentage terms when compared to a tax payer, if both pay in the same amount into the account each month.

I believe the non-tax payer can reclaim from HMRC - but a bit of a nuisance to have to do so.