halifax reward and tax credit

coolcats

I haven't asked tax credits, as yet. And my total other income is likely to be over £300 still need to add others.

zagfles

I think it should be included. There've been long debates on other forums as to whether the rewards counts as "interest" or "annual payment", but in either case, it would seem it counts for tax credits See: https://www.gov.uk/hmrc-internal-manuals/tax-credits-technical-manual/tctm04501

It would be grossed up figure you use.

zagfles

coolcats wrote: »

Still confused, but halifax have said its classed as a reward, so will not add it in for tax credit. As should work same as cashback a bonus to use the account.

If Halifax think it should work the same as cashback then ask them why they take tax off it.

Basically this account confuses both Halifax and HMRC. Neither seem to have a clue what it counts as.

zagfles

coolcats wrote: »

So for tax credit purpose its classed as other income and needs to be added in as the gross figure for the year (£75). And as a non tax payer I can get the tax back on it?

Thanks for all the help

See this another confusing issue. If you earn below the personal allowance you should be able to reclaim the tax. But if you're in the 0% savings band then you can get it back if it's "interest" but not if it's an "annual payment".

And they keep going on about "tax simplification" :rotfl: