PPI Tax Due 1 year later??

jobeone_2

August last year i received money from a PPI claim and there was no mention of paying any tax on the interest. Today I received a letter from lloyds saying they apologise and failed to mention in their letter in August 2012 that 8% of the compensatory interest is taxable income.

Does anyone know if I have a case against Lloyds as this a year later and they never mentioned anything in their original letter?

Thanks
Jo

roonaldo

I dont think HMRC would buy the fact that you blame it on Lloyds TSB. What would you think you have a case for? you've suffered no financial loss.

Anyway August 12 is in the 12-13 tax year, so you need to submit a tax return by end of Jan 14 if doing on-line self-assessment.

-taff

You have no case.

meganmay

I too have had a letter today. I am very angry that I was not told this when they paid out in April 2012. Letter says "please accept our apologies for not telling you before" I want to know as others do WHY they didn't tell me at the time when I would have paid the tax immediately.

kkgree1

On a side note, you don't need to wait for the next tax year to declare it. I received a PPI payout in February and declared the 8% interest to the HMRC hotline. With a bit of chasing, I have paid it by cheque yesterday. Alternatively, you can have your PAYE code changed to take the money in instalments from next April.

meganmay

Yes I have now found that out but thanks. My point however is that LloydsTSB did not inform me of it until 1 year and 3 months later. They put in their letter that I got yesterday "please accept our apologies for not telling you this at the time". I would be interested to know why that happened.

roonaldo

meganmay wrote: »

. I would be interested to know why that happened.

to be honest they are not obliged to tell you, some lenders dont but some do, you havent been penalised so I wouldnt worry

magpiecottage

I bet they didn't tell you that if you use Andrex you will spend less on Persil either.

I would complain about that too if I were you.

Ixashe

I've got a similar situation with interest on a refund. The bank is automatically taking the tax off the interest and so giving me a reduced amount, but I don't earn enough to pay tax even with the interest so can I stop them holding this part of the money back? Obviously I know I can apply for a tax refund at the end of the financial year, but thats a lot more hassle to go to for something that shouldn't have been paid in the first place.