I'm a student and I've been charged interest on my savings

oojeyboojey

I'm a PhD research student, and my A&L savings account balance shows I've just been charged tax on my savings. I've sent them an email to ask for a refund, but do I have to do anything else as well? I've already sent the relevant forms to the inland revenue to say I'm a student ages ago...

dzug

The fact you are a student is totally irrelevant. If your income for a tax year pushes you into the tax bracket then you pay like anyone else.

To avoid paying tax in future (assuming your income is low enough not to) you need to get a form from A&L or the tax office (an R85, but I could have the number wrong) and send it to A&L. They won't apply it retrospectively - you will have to reclaim it from the tax office.

morg_monster

It is a little more complicated than that dzug, it depends how a student is financially supported through their studies.

Student Loans do not count as taxable income for the purposes of working out whether you have to pay tax on your savings. (source: http://www.hmrc.gov.uk/taxback/question6.htm)
Hence, if you are receiving a non-taxable studentship to fund your PhD, I'm pretty sure that doesn't count either although I can't find a source for that.

Are you working as well? If you are and are earning more than £5,225 in the tax year from your job, you do then have to pay tax on ALL your savings interest.

You can fill in a R85 form online here to not pay interest on your savings in future (you have to fill out a new one every tax year)
http://www.direct.gov.uk/en/Diol1/DoItOnline/DG_4017954
Also I would contact the student advice centre at your uni as a start to find out whether your studentship counts as income for this purpose, I'm sure doesn't as you don't pay income tax on it.

Voyager2002

Post #3 is absolutely correct. I can confirm that a PhD studentship does not count as taxable income.

CLAPTON

Well post #3 isn't quite correct as you do not have to fill a R85 in each year but you do have to fill one in for each (non ISA) account and give it to your bank/building society (and not the HMRC).

As already said, refunds have to come from the HMRC .. you need to complete form R40.

oojeyboojey

Thanks guys! I should have mentioned that I haven't earned anywhere near my tax-free allowance for earnings this year.

A&L have got back to me with the forms I need to fill out. It's annoying when you tell them you're a student when you sign up for the account, but still have to go through all the hooplah of form-filling and sending and waiting and waiting for a rebate for what is essentially your own money that they have no right to. Pah!

Well, I can just sit back and dream of all the things I can do with that £20 when it finally comes back to me...

RayWolfe

You may learn through life that everything that happens to you is not always someone else's fault. It is your responsibility to know about your own tax affairs. And as you are doing a PHD, you could hardly be considered to be one of the sort of people that need your hand holding all the time.

oojeyboojey

RayWolfe wrote: »

You may learn through life that everything that happens to you is not always someone else's fault. It is your responsibility to know about your own tax affairs. And as you are doing a PHD, you could hardly be considered to be one of the sort of people that need your hand holding all the time.

Well excuse me for asking for tax advice from a forum designed for just that purpose! I don't need my "hand holding", but neither to do I go through life blithely immune to feelings of annoyance at the bureaucracy involved in getting tax rebates. It's not easy to live on 12k a year, and keep up mortgage payments, bills and costs for your own wedding, you know. The fact that I lose interest on the money that I've been taxed actually matters to me. I thought that was in the spirit of this forum!

Obviously, I was not born with an innate knowledge of all tax issues, unlike you.

RayWolfe

Silly boy!

Unhban

Get the violins out. Have you heard of 'cutting your cloth to suit your needs'? Mortgage? Marriage! Perhaps 'holding' and 'hand' do go together....

missile

......... or get a job. When I was at uni I had no savings, worked hard to make ends meet and guess what - I was taxed on my income too.