Paying 40% tax on PPI interest

andymullen

I am a 20% tax payer but have received interest on PPI payments which take me into the 40%tax bracket. However, the interest was on payments which date back to the mid 1990s. So, technically, I earned the interest over a number of years although I was paid the interest I had earned in one lump sum. Does anybody know if I can appeal against being asked to pay 40% on interest which has take me 20 years to accrue?

meer53

Was it the PPI refund PLUS the interest that took you into the 40% or JUST the interest on the PPI refund ? The two are separate amounts.

I can't see any appeal being successful, but you could always try.

dunstonh

. So, technically, I earned the interest over a number of years

Technically, the interest was paid this year. not over a number of years.

Does anybody know if I can appeal against being asked to pay 40% on interest which has take me 20 years to accrue?

No. You have no grounds. You are taxed at the point you are paid interest. Not the period it was accrued over.

andymullen

I received over £6000 in interest alone so it is the interest . If the which has taken me into the 40% bracket.

I'm all for paying tax when it is due but the 8%interest used to calculate interest is 8% per annum. If the interest is calculated per annum it seems unethical to me to calculate the tax on the final lump sum. It's not as if I had a say in the matter!

dunstonh

I'm all for paying tax when it is due but the 8%interest used to calculate interest is 8% per annum.

Irrelevant.

If the interest is calculated per annum it seems unethical to me to calculate the tax on the final lump sum.

nothing to do with ethics. it is to do with the point it is paid. Just as income is.