Tax paid on money from house sale beford buying another

maud1880

I recently sold my house and as I was moving into a different area moved into rented accomodation while looking for another to buy.
I bought another house 4 months after selling my previous one.
During this time the money was in my bank savings account and tax was deducted from it.
The house I sold was my home. I had owned it for 17 years. I do not own, and have never at any time owned, a second home.
I question if the tax should have been deducted but can find no information about it.
If anyone could let me know if I should, or should not, have paid the tax I will be very grateful.
Also if I shouldn't have paid the tax then how do I go about claiming it back.
Thank you.

molerat

Tax would have only been deducted on the interest earned and not the balance. Where the money came from is of no relevance. Whether you should have been taxed or not is dependent on your income.

macman

Unless the savings account is an ISA or other tax free account, then tax will be deducted from the interest earned at the basic rate of 20%. Nothing to do with CGT on a second home.
If your income is below the income tax threshold then you need to apply to have interest paid gross not net.

ellie27

As above, you did not get charged tax on the sale proceeds. You were taxed on the interest you received. Any money in your bank account is taxed in that way.

If you put in 100k you should still have 100k (unless you spent some!) You might have a bit more than 100k as you may have gained a wee bit interest on it, but that bit of interest would have been taxed , however you should still have the 100k.

Kynthia

As others have said you earnt interest on the money, interest is income, generally income is taxed. If you don't earn enough to pay income tax then that's different and there's a form to give your bank for that.