Savings tax 10%?

xylophone

The other one which ends total tax due £9,349 is just over my head.

I think that zygurat has assumed that the savings income (ie the interest on savings) was £40,000?

It would appear that what you mean is that you have £40,000 in capital and have received interest of £1200? Was this gross?

roxy28

Yes its capital, if i had earned £40,000 in interest that would be a huge amount of savings, i wish lol.

xylophone

http://www.hmrc.gov.uk/forms/r40.PDF

roxy28

Thanks for the link.

So if i give this simple example.

Gross interest = £2,500 per year, then all the interest would be taxed at 10%.

jem16

roxy28 wrote: »

Thanks for the link.

So if i give this simple example.

Gross interest = £2,500 per year, then all the interest would be taxed at 10%.

Assuming you are still talking about earned income of £9500 then yes for this tax year and no for last tax year.

If you would like to be more specific, then we can be more specific.

xylophone

no for last tax year.

http://www.hmrc.gov.uk/rates/it.htm

jem16

xylophone wrote: »

http://www.hmrc.gov.uk/rates/it.htm

Is there a specific reason that you have given the link to HMRC in answer to my no for last year statement?

Roxy28 asked if all the £2500 gross savings would be taxed at 10%.

Income earned = £9500
Personal allowance for 2012/13 was £8105 so £1395 of that is taxed at 20%.

The 10% savings band was £2710 last tax year so £2710 minus £1395 leaves £1315.

So for gross savings of £2500, £1315 would be taxed at 10% and £1185 taxed at 20%.

So no for last tax year as not all of the £2500 would be taxed at 10%.

roxy28

With the help you have give i now understand, thanks.
Yes it will be for this tax year so far that the gross interest will be taxed at 10% unless circumstances change.

Last year my income was more but thats another story.

Thanks again to you all.

xylophone

Is there a specific reason that you have given the link to HMRC in answer to my no for last year statement?

The link gave details of tax allowances for tax year 12-13 which would have enabled OP to insert correct figures in example 4 in link in post 6.

jem16

xylophone wrote: »

The link gave details of tax allowances for tax year 12-13 which would have enabled OP to insert correct figures in example 4 in link in post 6.

Ok fair enough. It seemed like you were disagreeing with me.