Will I have to pay tax on my payout

rincelex

I am afraid its too late to transfer any shares as the deal has been done and I have the paperwork to complete and return in order to get my money. I only found out it was happening about three weeks ago.

What is confusing me is I left full time employment in 2009, since then my annual income has been well under the personal allowance so it has never occurred to me to contact the tax office, I even still pay tax on savings interest that I could be claiming back but have not done so. Am I supposed to initiate this whole process and contact HMRC or do they contact me? What happens if I don't contact them - will I get fined or worse. I just don't know where to start should I go and see a financial advisor or accountant.

jem16

rincelex wrote: »

What is confusing me is I left full time employment in 2009, since then my annual income has been well under the personal allowance so it has never occurred to me to contact the tax office, I even still pay tax on savings interest that I could be claiming back but have not done so.

Well you can still claim back for the last 4 years so get onto it now.

Am I supposed to initiate this whole process and contact HMRC or do they contact me? What happens if I don't contact them - will I get fined or worse.

You are responsible for your own tax so you need to contact HMRC. They will eventually find out as the company will notify them of any chargeable gain. So I doubt a fine but you will get a bill.

I just don't know where to start should I go and see a financial advisor or accountant.

Neither are necessary.

Just phone HMRC and advise them that you want to claim back tax from savings interest and advise them of the capital gain. Phone at 7:45am for the best chance of getting through.

AndyT678

rincelex wrote: »

I even still pay tax on savings interest

Download this form, fill it in and give it to your bank(s) and they will pay you the gross interest from now on and you won't need to bother claiming it back in the future.

https://www.gov.uk/government/publications/income-tax-get-interest-without-tax-taken-off-r85-from-6-april-2015

jem16

AndyT678 wrote: »

Download this form, fill it in and give it to your bank(s) and they will pay you the gross interest from now on and you won't need to bother claiming it back in the future.

Will only apply to this year anyway with interest due to be paid gross from April 2016.

rincelex

Thanks I will ring them as soon as I have got the money. The amount of tax paid over the last 4 years in total is probably less than £10 from previous experience I know that the money I would be claiming back I would spend on the phone call to get it back so it wasn't worth it.

Thank you everyone for your very sage advice.

rincelex

Just to follow up and in case anyone else needs to know.

I contacted the Tax Office and even though my earnings don't exceed £5,000 for last year I have to complete a tax return for the year 15/16. Yes the sale resulted in me receiving over the annual allowance for CGT and once the tax return is completed and submitted I will receive a notification of what to pay. I have started the tax return and at the moment the hardest part is finding the paperwork for the little income that I did have.

Again thanks for the advice.

greenglide

You are using the online version, I hope?

The online version is very easy and doesn't ask you about the bits that you don't need. A very straightforward process.

jamesd

Thanks for letting us know. No surprise, what you're getting is just the standard treatment for your situation.

Definitely easiest to use the online system and that also provides a convenient way to pay the bill online. You can also do some past years for savings if you want, though not all four years. It takes a bit of getting used to but once you've done it a time or two it's not too painful.

rincelex

Yes I am finding the online version quite easy and once you have filled in the first couple of sections it then comes up with just the bits you need to complete and I like that you can go in and it saves as you go along. Can't say the same for my husband, he hates it.

When I spoke with them they said that as my earnings are so low I may only have to do 1 year because of the CGT.