Tax and savings

littlerussell

Just wondering ...

As of this year, I pay tax at 40% as I am just over the higher-rate threshold, through PAYE. I have no other income, except for a relatively small amount of interest on savings accounts (about £150 per year).

I know I should look at an ISA but for various reasons don't want the money locked away.

The interest is taxed at basic rate.

Do I need to be filling in some kind of self-assessment just for the sake of £150 x 20% additional owed ... £30/year?

Should they be sending me a form? Do I need to request it? Do all higher rate taxpayers complete forms?

Confused.

xylophone

Money in an ISA needn't be "locked away" - it can be instant access.

http://www.hmrc.gov.uk/taxon/bank.htm - the horse's mouth....

jem16

littlerussell wrote: »

Just wondering ...

As of this year, I pay tax at 40% as I am just over the higher-rate threshold, through PAYE.

Remember that is the higher rate threshold plus the personal allowance which, unless you have any taxable benefits in kind, is £42,475 for this tax year.

Do I need to be filling in some kind of self-assessment just for the sake of £150 x 20% additional owed ... £30/year?

No. You can just phone HMRC and tell them the amount. They can then adjust your tax code to collect the extra tax.

Should they be sending me a form? Do I need to request it? Do all higher rate taxpayers complete forms?

No it's your responsibility to inform HMRC.