I.R & Bank Accounts

supermanjo

I have an odd question. I keep hearing this floating around but I could only assume its blabble.

Is it true that if you have more then £8,000 in your bank account, the bank will notify the Inland Revenue?

MoneySaverLog

Sure the banks have to inform the revenue, how else are they going to get the tax on your interest. They also need to make sure you're not breaking any ISA rules with limits and number of subscriptions in the tax year.

What have you got to hide?

supermanjo

I'm pretty sure the bank pays me no interest on my balance and I don't have any ISA's.

However, that wasn't my question. Is there a certain limit before the bank informs I.R?

missile

I am sure there are rules. I do not know what they are and the bank is unlikely to tell you.
It may well depend on which bank? For example, some banks seems to have more onerous requirements to satisfy money laundering regs than others.

antonic

HMRC arent interested in the balance of your bank account, just the amount of GROSS interest received if you have signed an R85 to have the interest paid gross.

Every year, Banks & Building Societies make a Section 17 return to HMRC off all accounts that have been registered for gross interest, HMRC then check that the account holder`s income was below their personal tax allowance (that is income from ALL sources including wages, interest etc) and if it was no problem - if it wasnt then they instruct the bank/building society to cancel the R85 so tax is deducted in future.

Once the R85 is cancelled the account CANNOT be registered for gross interest again, until the cancellation notice is removed by HMRC.

HMRC may also pursue for any underpaid tax due to an R85 being incorrectly used.

MoneySaverLog

I think you'll find that the bank can report anything suspicious on your accounts with them if they suspect money laundering to SOCA who may in turn inform the IR