Santander 123

colsten

2010 wrote: »

How will you declare it if you don`t already get a self assessment tax form?

You can fill in an online self-assessment. Or you can tell HMRC of your taxable income and they might adjust your tax code.

Moby

One more thing helpful folks:) If I go over the 20K limit... I assume I lose interest on only the amount I'm over 20K? ie I still get paid the interest on savings up to 20k?

xylophone

Sorry, but you can do it, as long as you pay your tax at the end of the day.

This is not the case.

https://public-online.hmrc.gov.uk/lc/content/xfaforms/profiles/forms.html?contentRoot=repository:///Applications/SpecPersTax_iForms/1.0/R85&template=R85_20156.xdp


"By filling in this form R85 you are telling your bank or building society that you do not expect to have to pay tax on the interest
paid to you.

You must fill in a form to cover each account you hold."

Even if you expect only some of your interest to be taxable, you should not fill in the R85.

See https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/293747/Fact_sheet_template_-_10__tax_9.pdf


"From April 2015, Sharon will receive £14,000
per year from her pension. Her tax-free personal
allowance is £10,500, so she is taxed at 20%
on £3,500. Sharon also earns £2,000 a year
in savings income. Sharon’s total income is
£16,000. Because Sharon’s total income is more
than her personal allowance plus £5000, she is
not eligible to register for tax-free savings, but
will be able to claim back some of the tax on her
savings income. She can do this by filling out an
R40 form and sending it to HMRC.

castle96

One more thing helpful folks:) If I go over the 20K limit... I assume I lose interest on only the amount I'm over 20K? ie I still get paid the interest on savings up to 20k?

Interest paid on £17k, ie from £3k to £20k

xylophone

If I go over the 20K limit... I assume I lose interest on only the amount I'm over 20K? ie I still get paid the interest on savings up to 20k?

No interest is earned on amounts over £20,000 - move the interest earned and any cash not required to service the account to another interest bearing account?

ColdIron

castle96 wrote: »

Interest paid on £17k, ie from £3k to £20k

No, interest is paid on the full £20K, the £3K is the threshold required to qualify for 3% rather than 2% but it is applied to the whole balance

bigfreddiel

xylophone wrote: »

This is not the case.

https://public-online.hmrc.gov.uk/lc/content/xfaforms/profiles/forms.html?contentRoot=repository:///Applications/SpecPersTax_iForms/1.0/R85&template=R85_20156.xdp


"By filling in this form R85 you are telling your bank or building society that you do not expect to have to pay tax on the interest
paid to you.

You must fill in a form to cover each account you hold."

Even if you expect only some of your interest to be taxable, you should not fill in the R85.

See https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/293747/Fact_sheet_template_-_10__tax_9.pdf


"From April 2015, Sharon will receive £14,000
per year from her pension. Her tax-free personal
allowance is £10,500, so she is taxed at 20%
on £3,500. Sharon also earns £2,000 a year
in savings income. Sharon’s total income is
£16,000. Because Sharon’s total income is more
than her personal allowance plus £5000, she is
not eligible to register for tax-free savings, but
will be able to claim back some of the tax on her
savings income. She can do this by filling out an
R40 form and sending it to HMRC.

Well with a 123 account you don't need to fill in an R85, because you can set the 123 account to pay gross interest. So no hmrc rules broken!

Then you do a tax return to tell hmrc your income details, both gross and net, divis, and earnings.

Cheers fj