Pensioner Bonds Guide

xylophone

Once again, may I refer you to the R40 notes. (2016)

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/419507/R40_Notes__2015_internet_v2.0.pdf

These bonds are

65+ Guaranteed Growth Bonds

See page 3 and 4 of the notes above which say:-

"UK interest
and dividends

Please include income received from:

• National Savings & Investments products where tax is taken off before you receive it (First Option Bonds – no longer available, Guaranteed Growth Bonds and Guaranteed Income Bonds)"



The interest on these bonds is added to the account on the anniversary of the bond - where this anniversary was on or after 6 4 2015 and before 6 4 2016 it was added and capitalised in the tax year 2015-16.

It is clear that it must be included on any tax return/R40 for the year in which it was added to the account.

You will note that all the interest you receive in the tax year is simply added together for the purpose of the form - you do not differentiate it by source.

See page 2 of https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/419506/R40_M__internet_v2.0.pdf

Therefore,if you are due to receive a repayment of tax, it will be calculated on these figures and if it includes the interest from the 65+ Guaranteed Growth Bonds then a refund will be received?

young_pensioner

[Reply to post #420 from zylophone]
Absolutely certain that the R40 has been received.

I was self employed until the end of 2013/14 tax year. When I submitted my final self assessment, I included the fact that I was finally retiring. I received an email acknowledgement of the fact.

Latterly, during the 'waiting' period, I received a letter saying that it should be included in my self-assessment. I telephoned again and the gentleman said that he couldn't understand why the S/A final notification had not been processed correctly. He then proceeded to do so.

The whole thing seems to be a total mess!

young_pensioner

teddysmum wrote: »

This has been discussed on another thread, but HMRC told me twice (over the phone) that you can't get your tax back until the bond matures

I honestly don't think that these call-centre people are fully informed or misunderstand the rules.

My personal interpretation is that the tax deducted can only be reclaimed after the interest has been actually received into the bond account. It would be completely unfair to make people wait until the final maturity is reached after 3 years!

teddysmum

young_pensioner wrote: »

I honestly don't think that these call-centre people are fully informed or misunderstand the rules.

My personal interpretation is that the tax deducted can only be reclaimed after the interest has been actually received into the bond account. It would be completely unfair to make people wait until the final maturity is reached after 3 years!

The interest goes into the account annually, as it is compounded, but one call centre person and another,who said she was unsure and went away to ask ' someone higher up', said that the interest has to be actually accessible before you can reclaim the tax (ie wait 2 years); just being in the account is not enough.


As you say, it is unfair, but there are several sources quoting the 'on maturity' ruling, which is being adhered to, because of no special case directive.


The Treasury site people either don't know the answer or choose to ignore the question, because they don't want to admit that they are being unjust.

FOREVER21

My wife is not liable for tax due to low total income.

Her 3 yearNS &I bond paid interest nett in January, she completed her SA and has received a refund of the tax from HMRC

young_pensioner

FOREVER21 wrote: »

My wife is not liable for tax due to low total income.
Her 3 yearNS &I bond paid interest nett in January, she completed her SA and has received a refund of the tax from HMRC

Does your wife usually complete an annual SA? If so, I can only assume that you must have other reason(s) to do so.

xylophone

Once more into the breach...

The interest has been received, has been added to the account, (capitalised) and is therefore itself earning interest.

NS&I has issued statements of interest paid and tax deducted.

See post 422 above and also post 426.

Her 3 yearNS &I bond paid interest nett in January, she completed her SA and has received a refund of the tax from HMRC

Ta-da!:)

FOREVER21

young_pensioner wrote: »

Does your wife usually complete an annual SA? If so, I can only assume that you must have other reason(s) to do so.

Yes SA completed every year as she earns over£2500 interest and HMRC rules means she has to forward one.

For the past few years form completed and no further action needed, but this year as she had paid tax on the bond she got a refund.