Purchased Annuity and Tax return

kilrail

Well, having got nowhere with HMRC I called Aviva and after being fobbed off the first time, I managed to finally talk to someone called Luke who seemed to understand my point. I was told firstly that the default position was to deduct no tax but I suggested that it should be treated the same way as Building Society interest i.e. default tax deducted at 20% and you need to complete a form to say you are a non tax payer, not the other way round. Luke agreed and said it would be changed next payment.
Then we addressed the issue of the tax cert as I still thought the figure should show the taxable amount and not the total inc capital (I'm not sure how that would work yet - maybe show both figures), again Luke agreed and said an amended tax cert was on it's way to me.
And, it actually turned up today - exactly the same as the previous one so I have now reverted to to sending a letter and wait to see if it gets a result. Watch this space.

xylophone

It does seem very strange that you are having to teach Aviva their business!

Perhaps you should refer them to this link http://www.pruadviser.co.uk/content/26670/386375/

or this https://www.adviserzone.com/adviser/public/adviserzone/propositions/individual/annuities/pla

Equally odd that HMRC couldn't help?

kilrail

Thanks for the links which confirm exactly what I have been saying but it's worse than that, even their own literature says you should only declare the interest part but the tax certificate they send you (well me anyway) only shows the total gross amount and states you should show this on your tax return.
The response I received from both Aviva and HMRC was misleading at best and downright nonsensical. Aviva even suggested I should ask for an income declaration from so I could have tax deducted - the exact opposite of what should happen,

Here's their own pdf which they need to read, http://www.aviva.co.uk/adviser/product-literature/view-document.cgi?f=an02001.pdf

xylophone

Here's their own pdf which they need to read, http://www.aviva.co.uk/adviser/produ...?f=an02001.pdf

"If you're buying the plan with your own money,
HM Revenue & Customs is likely to agree that each of
your payments can be split into two parts:
– a capital part – which is tax-free; and
– an interest part – which is taxed.


If HM Revenue & Customs won’t agree to us deducting
tax only from the interest part, then we’ll deduct basic
rate tax from the whole of each of your payments. "

Aviva seem full of ifs and buts whereas the information given by the Pru
and Standard Life (see previous links) seems quite definite.

Is there something about Aviva's policy that makes it different and causes all these heart burnings with HMRC?

And is there a specialist unit at HMRC that can provide the answer?

kilrail

My main gripe really is that the tax certificate they sent does not show the interest part, which is after all the figure I need to enter on the tax return. Indeed, I am concerned that just maybe, all their tax certificates for this product are incorrect.
Their own document states " We'll send you a tax certificate at the end of each tax year. You must declare the interest part on your annual tax return" but then they send a cert only showing one amount the total gross payment with a neat little arrow saying - declare this figure on your tax return.

Now, what if they are sending these to all purchased annuity holders and some are doing just that, they will end up paying too much tax.

Now waiting for a written reply!!

xylophone

Do come back and tell us the answer!
http://origin-www.legislation.gov.uk/uksi/2008/562/pdfs/uksiem_20080562_en.pdf
Claire Ritchie at HM Revenue and Customs Tel 020 7147 2586 or e-mail
claire.ritchie@hmrc.gsi.gov.uk.
Do you think this lady might have the answer?

jamesd

kilrail, that's interesting. They may have a significant amount of correcting and maybe redress paying to do if it's been done that way for all payees.

kilrail

Yes indeed and that link (2008) is interesting as it gives a contact at HMRC (that's if she's still there). Amazingly, today, I got an annoyingly standard letter to say that my payments "were going to change because the tax authorities had told them to start deducting tax" and signed by a Mr Hugh Hessing - Director of Customer Experience.

Again, as I told them in an email , this is total nonsense, as the tax office don't have to contact them, and in any case they didn't refer to the policy number, only my client number which covers standard pension policies as wel,l and are subject to paye and communication from HMRC.

When I finally receive some sensible answers and hopefully my rather direct emails will have prompted some escalation, I may well make it more public, perhaps via Tony Heatherington of the Daily Mail as it is just possible there is a greater problem with their tax certificates.

Rest assured I will update this thread and as a retired person :rotfl:I have time on my hands to be a real Victor Meldrew!

kilrail

All quiet from Aviva - if no reply by Monday's post I will call and demand to speak to a manager.

xylophone

All quiet from Aviva - if no reply by Monday's post I will call and demand to speak to a manager.

Waiting with bated breath...:)