Interest from next year

Phaelok

Hi everyone,

I was hoping someone on this forum could clarify something for me relating to interest changes next April.

"From April 2016 banks and building societies will stop automatically taking 20% in income tax from the interest earned on your non-ISA savings".

To date I have:

£20k in Satander
£2k in TSB
£2.5k in Nationwide
£3k in Tesco
£1.4k Halifax HTB
£1.5k in normal account

I earn just under £42k per year.

Does that mean that we have to declare how much savings we have OR is tax deducted once we exceed the interest free threshold?

Thanks

HappyMJ

Phaelok wrote: »

Hi everyone,

I was hoping someone on this forum could clarify something for me relating to interest changes next April.

"From April 2016 banks and building societies will stop automatically taking 20% in income tax from the interest earned on your non-ISA savings".

To date I have:

£20k in Satander
£2k in TSB
£2.5k in Nationwide
£3k in Tesco
£1.4k Halifax HTB
£1.5k in normal account

I earn just under £42k per year.

Does that mean that we have to declare how much savings we have OR is tax deducted once we exceed the interest free threshold?

Thanks

You have to declare any interest in excess of £1,000 per year. As long your income stays at or below £42k.

If you earn any more and are a higher rate tax payer you would have already been declaring the interest and paying tax on it so it's no different.

colsten

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/414026/Savings_factographic_final.pdf

There are one or two existing threads discussing how any required tax payments will be handled - in a nutshell, it will be several months before anyone knows in detail

Phaelok

Thank you both for clarifying this.

YorkshireBoy

A couple of observations:

1. You talk of both 'I' and 'we'. If there are two of you, there's scope to significantly increase the aggregate return by opening more 4-5% accounts.

2. You don't have Club Lloyds. You might wish to consider shifting the £3K from Tesco, £1.5K from wherever, and some from Santander.

savings_my_hobby

YorkshireBoy wrote: »

A couple of observations:

1. You talk of both 'I' and 'we'. If there are two of you, there's scope to significantly increase the aggregate return by opening more 4-5% accounts.

2. You don't have Club Lloyds. You might wish to consider shifting the £3K from Tesco, £1.5K from wherever, and some from Santander.

I would think about drip feeding into some high interest regular savers too.