interest tax returns

tom134

Greetings,

I have a question about interest tax returns --

I am 34 years old and have been unemployed with an income of lower than £5000 per year due to health reasons since May 2010. For past 5 years, I still have been paying interest tax (20% rate) as ordinary tax payer. Recently I learnt I would be able to make a claim on interest tax returns, does anyone know how to do this for past 5 years, is it done on an annual basis?

With regards to my banks, is there any document I need from them and if I need to notify my banks to stop paying interest tax (until I am fully recovered and become employed again), how to do this?

Many thanks for all your kind help in advance.

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I have just had a look at R40 and have a few questions:

1. Is this form only document I need to use to claim tax returns? Shall I complete and send R85 to HMRC at the same time?

2. On the top of the form R40, it says "year to xxxx", do I need separate repetitve forms for each year?

3. R40 also asks about "Net interest paid by banks, building societies etc and purchased life annuities" ---- do I need to calculate and add up all interests from all banks for that year? It would be a lot of work.

masonic

Useful information here: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/368535/r85-helpsheet.pdf

You should be able to claim for all 5 years if you are quick and I think you'd need a separate R40 form for each tax year.

xylophone

https://www.gov.uk/government/publications/income-tax-claim-for-repayment-of-tax-deducted-from-savings-and-investments-r40

http://www.litrg.org.uk/tax-guides/tax-basics/how-do-i-claim-tax-back/how-do-i-claim-back-tax-on-savings-income



"What are the time limits for claiming back overpaid tax?

You have four years from the end of the tax year to claim a refund, as shown below. If a claim is not made within the time limit you will lose out on any refund that may be due and the tax year becomes ‘closed’ to reclaims.

Tax year 2010/11 (year ended 5 April 2011) – claim by 5 April 2015

Tax year 2011/12 (year ended 5 April 2012) – claim by 5 April 2016

Tax year 2012/13 (year ended 5 April 2013) – claim by 5 April 2017
"
Tax year 2013/14 (year ended 5 April 2014) – claim by 5 April 2018"

tom134

I have just had a look at R40 and have a few questions:

1. Is this form only document I need to use to claim tax returns? Shall I complete and send R85 to HMRC at the same time?

2. On the top of the form R40, it says "year to xxxx", do I need separate repetitve forms for each year?

3. R40 also asks about "Net interest paid by banks, building societies etc and purchased life annuities" ---- do I need to calculate and add up all interests from all banks for that year?

As some accounts are no longer active now, it is very difficult to get the numbers right.

Vortigern

R40 is used to reclaim tax overpaid in previous years. You need one for each tax year. You send it to HMRC. Be quick if you want to claim for tax year 2010-11

R85 is used to stop deduction of tax by the banks. You send it to the bank.

masonic

tom134 wrote: »

1. Is this form only document I need to use to claim tax returns? Shall I complete and send R85 to HMRC at the same time?

2. On the top of the form R40, it says "year to xxxx", do I need separate repetitve forms for each year?

You just need to fill out an R40 form for each tax year and send to HMRC. The R85 forms should be sent to each bank so that they don't take off any tax in the future.

3. R40 also asks about "Net interest paid by banks, building societies etc and purchased life annuities" ---- do I need to calculate and add up all interests from all banks for that year? It would be a lot of work.

Yes, you'll need calculate how much interest you earned and how much tax you paid. The banks may have provided you with a certificate of tax deducted that you can use or request, although you may not be able to get one in for the 2010/11 tax year before the claim deadline.

tom134

Do you mean for all other recent years, my bank should be able to provide an amount for total interest and tax paid in all accounts?

masonic

tom134 wrote: »

Do you mean for all other recent years, my bank should be able to provide an amount for total interest and tax paid in all accounts?

Yes, you should ask them for a certificate of tax deducted for each account for the relevant tax years. It should make things quite a bit easier for you.

Vortigern

tom134 wrote: »

Do you mean for all other recent years, my bank should be able to provide an amount for total interest and tax paid in all accounts?

Yes. Ask for a certificate of tax deducted.

If you're working from statements and you see "net interest" you multiply by 1.25 to get the gross amount.

If you see "gross interest" multiply by 0.8 to get the net amount.

Subtract net from gross to get the amount of tax paid.

tom134

Besides I am wondering if no document from bank is needed along with r40 form to HMRC, what would happen if I can not get numbers correct as some accounts are already closed or if I had miscalculations?

masonic

tom134 wrote: »

Besides I am wondering if no document from bank is needed along with r40 form to HMRC, what would happen if I can not get numbers correct as some accounts are already closed or if I had miscalculations?

If you don't think you have enough information to make an accurate claim, then it would be worth trying to get hold of a summary for that year as well. The trouble is that you have a little under a week to get your claim in the post if it is to be received by the end of the tax year. Depending on the bank and your access to a branch, you might be able to go in and get them to print off everything you need there and then.