Tax due on savings but below Self Assessment trigger limit?

JasX

Hey all,

So here's my situation, in the past I was required to fill in a SA tax return -> I was working overseas, the tax arrangements we mildly complex and I was hitting a few other 'you need to fill in a SA form' triggers.

Now I've been UK based for a couple of years I've had a look here:
http://www.hmrc.gov.uk/sa/need-tax-return.htm#1

And from the looks of things don't need to fill in a tax return any more as I'm below all the triggers, the only thing I may wander close to is income from taxed/untaxed savings but until I have *income* of £10,000/£2,500 from these the SA requirement doesn't trigger

So I've just phoned up IR and been through the criteria/my situation and they've determined I don't need to fill in a SA return and have cancelled the notice.

So question:

I pay income tax at the marginal rate of 40%
I have savings with income below the trigger levels which are taxed at source at 20%

The last couple of years I've been filling my return and ended up writing IR a check for what was roughly the missing 20%

So is it correct I'm below the trigger level, IR isn't interested in collecting it the SA route so I'm getting to keep that 20% now? and I've been a bit of a mug the last couple of years spending time filling in my SA form and sending IR £100-£200 odd I didn't have to? There doesn't seem to be any other way they'd collect it?

No chance of getting it back now I assume as it was 'due' tax but just thought I'd check my interpretation of the situation.

purdyoaten

You have income from savings, investment or property

If you are an employee or a pensioner and already pay tax through a PAYE code, you can sometimes ask for tax that you owe on income, such as savings and property, to be collected through your code number.

Strictly you do not have to complete a return but your tax position would be clearer and more exact if you did. See above - I believe that a telephone call would suffice for the HMRC to adjust your tax code to collect the additional tax.

http://www.hmrc.gov.uk/sa/need-tax-return.htm

xylophone

So is it correct I'm below the trigger level, IR isn't interested in collecting it the SA route so I'm getting to keep that 20% now?

In a word, no. You must declare your taxable income and pay the tax due.

You might just as well have continued with SA?

JasX

Ahh ok that makes sense. So I just contact hmrc, tot up the interest received that needs the extra 20% tax and tell them how much to adjust my PAYE by?

Since this involves adding two numbers together and doesn't incur a £100 fine if I'm late I think this suits me better

cheers for clarifying - I'm surprised hmrc didn't explain that at the time. (Or maybe they roll over last years SA figure? We'll see what they do)