Hsbc refund

Scoobydooby914

Hi I need a hand understanding my ppi refund. I've just been awarded a total of £4314.59 by hsbc for ppi on a few loans over the last 10 years. There is a part in the letter that says I have to now pay tax? But it doesnt make sense

The breakdown I have is as follows

Ppi premium redress £1394.03
Plus taxable interest at 8% £805.20
offer. £2199.24
Total offer. £4314.59

Now on the first page of the letter it says in the total redress offer there is an element of gross interest which amounts to £1583.23????
So how much tax have I got to pay? And can anyone understand this????

Thanks

Neil

bandofbrothers

Scoobydooby914 wrote: »

Hi I need a hand understanding my ppi refund. I've just been awarded a total of £4314.59 by hsbc for ppi on a few loans over the last 10 years. There is a part in the letter that says I have to now pay tax? But it doesnt make sense

The breakdown I have is as follows

Ppi premium redress £1394.03
Plus taxable interest at 8% £805.20
offer. £2199.24
Total offer. £4314.59

Now on the first page of the letter it says in the total redress offer there is an element of gross interest which amounts to £1583.23????
So how much tax have I got to pay? And can anyone understand this????

Thanks

Neil

I had the same letter.

Its if you have to declare your tax each year via a tax return to the inland revenue.

I wouldn't worry about it.

Im sure someone will be along to explain it better !

Clare_B_4

I had a similar letter from HSBC, basically it means you'll probably have to pay tax on the interest they're paying you.
If you PAYE, the easiest thing to do (or what I did) is to call the Tax Office/HRMC and explain that you've received this money and they can adjust your tax code so you pay it with your normal tax, through your employer.

bandofbrothers

I'm a little confused.

The interest hsbc paid would be to help cover what you would have earnt if the cash was sat in a bank account.


Edit : Since found out you are legally bound to pay tax on the interest given by the banks.

id rather pay this through my tax band than worry about having a tax bill down the line for tax avoidance !