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Personal Savings Allowance guide
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taxman1234 said:Here's a wee question from a thicko.
My income from work pension is only £5k
I have savings interest of £6k.
£11k in total.
Will I have to pay any tax on this?
I am assuming no tax because:
Pension covered by normal tax code?
And savings covered by PSA....the low income £5k plus the £1k savings allowance?
Am I totally wrong?
Thanks
You must use your Personal Allowance before you can use the savings starter rate band.
And must use the savings starter rate band before you can use the savings nil rate band (aka Personal Savings Allowance).
So with taxable income of just £11k you will have no tax to pay but haven't even used all of your Personal Allowance so the 0% tax bands are irrelevant.
But you have plenty of headroom for any increase in pension or interest.1 -
Thanks for all the super quick replies.
That sets my mind at rest.
I forgot to say that my tax code is 1026n after transferring the marriage part to my working wife.
Couldn't find any calculators online for working the particular income & savings interest tax implications.
Any of you lot know of one?
Thanks again folks0 -
Apologies if this has been asked/answered before.
It's very likely with the rise in interest rates my easy access savings will exceed the £1000 Personal Savings Allowance in 2023/24 by approx £500.00.
As I have already used my ISA allowance for this tax year I wondered what advice people would give?0 -
idb1979 said:Aplogies if this has been asked/answered before.
It's very likely with the rise in interest rates my easy access savings will exceed the £1000 Personal Savings Allowance in 2023/24 by approx £500.00.
As I have already used my ISA allowance for this tax year I wondered what advice people would give?
2. Don't worry about paying tax, get the best rate you can. 80% of say 5.2% is better than 100% of 4.0%.1 -
Does a Bank Switching offer count towards my PSA? I feel it does not but bow to your knowledge. Thanks in advance for what is probably a simple answer.0
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londoner62 said:Does a Bank Switching offer count towards my PSA? I feel it does not but bow to your knowledge. Thanks in advance for what is probably a simple answer.2
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Ok....sorry I'm back again.....interest rates have risen.
Here's my yearly income:
Pension £5k
Savings interest £11.5k (£210k @ average 5.4%)
Total £16.5k
Am I still tax free??
Has the going over the the £5000 (or £6000) personal savings allowance out me in the tax bracket?
Sorry for being dopey.
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taxman1234 said:Ok....sorry I'm back again.....interest rates have risen.
Here's my yearly income:
Pension £5k
Savings interest £11.5k (£210k @ average 5.4%)
Total £16.5k
Am I still tax free??
Has the going over the the £5000 (or £6000) personal savings allowance out me in the tax bracket?
Sorry for being dopey.
Just remember to file a self assessment next year.
Get registered asap, will make life easier.
1 -
Bigwheels1111 said:taxman1234 said:Ok....sorry I'm back again.....interest rates have risen.
Here's my yearly income:
Pension £5k
Savings interest £11.5k (£210k @ average 5.4%)
Total £16.5k
Am I still tax free??
Has the going over the the £5000 (or £6000) personal savings allowance out me in the tax bracket?
Sorry for being dopey.
Just remember to file a self assessment next year.
Get registered asap, will make life easier.
I forgot to say that my tax code is 1026n after transferring the marriage part to my working wife1 -
Thanks you two.
Your mention of Self Assessment got me intrigued.....just checked on gov.uk....yep anything over £10k in interest and I have to submit an SA return.
So will that be £10k earned from April to April?
I will probably be under £10k because of the lower rates April to July....so no SA return needed in that case?
Thanks for all your advice.0
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