Declaring Interest for Tax-What is the Mechanism?

polymaff

andy_poulton wrote: »

I thought this may be a simple query. Loads of info BUT not how to declare/pay.

We are retired basic rate taxpayers with state pension and occupational pensions from our jobs.

We have a cash nesteggs for our futures spread over Coventry/Virgin/Santander.

It is likely we will both go over the Interest Allowance of £1000 for 16/17

How do we declare it/pay tax on interest.

[FYI The three banks will not tell them or me. Just send statements at the years end (I hope) I have just spoken to the HRMC They said just ring and tell them when I know figures and they will take payment.
Then confusingly said estimate the 17/18 and cannot start to take the overdue tax until 17/18. Then said we could pay what we owe for 16/17 now in instalments plus what we think we will owe for 17/18]

WOW anyone any ideas? OR done this yet.
I have the worry beads out havent I
Cheers Andrew

Easy, Andrew.

First work out if you actually will owe HMRC any (more) income tax. I recommend:

http://forums.moneysavingexpert.com/showpost.php?p=70422918&postcount=9

but then I'm biased

If you do, then follow the highlighted sentence above.

... and then repeat the above for the other party!

Newly_retired

Like Colsten I have to do a tax return because I get a tiny foreign pension. Usually I end up having to pay under £60 in tax owed.
I assume interest in excess of £1000 will be taxed in the same way, as I have to declare it anyway. I hope banks will still send me, or allow me to print off statements of untaxed interest.
I hope they won't just assume the interest is the same as last year. It is not. Some rates have dropped, and I have spent or given away some of my capital. I can't see how they can make that assumption.

andy_poulton

Ha ha Well done thank you.
Just went off to have a look.

Yes now need to wait for the information from the Societies and banks.

polymaff

andy_poulton wrote: »

Ha ha Well done thank you.
Just went off to have a look.

Yes now need to wait for the information from the Societies and banks.

Assuming you are thanking and referring to my advice, Andrew (thats what the MSE Thanks and Quote buttons are for), you may need to push the Interest Payers and Pension payers. The latter are meant by law to give you the information by the end of May (I think), but the former can be very sluggish. I find that a verbal "I want you to supply Certificates of Interest for the Financial Yesr ending 5th April 2017 for all my accounts that have earned interest during that financial year" usually does the job.

polymaff

Newly_retired wrote: »

Like Colsten I have to do a tax return because I get a tiny foreign pension. Usually I end up having to pay under £60 in tax owed.
I assume interest in excess of £1000 will be taxed in the same way, as I have to declare it anyway. I hope banks will still send me, or allow me to print off statements of untaxed interest.
I hope they won't just assume the interest is the same as last year. It is not. Some rates have dropped, and I have spent or given away some of my capital. I can't see how they can make that assumption.

I understand that that is exactly what HMRC are doing - to the consternation of many in your position.

isasmurf

andy_poulton wrote: »

Thanks Jeems and Very Big Chris.

I have researched the link and undestand that.

The HMRC made no mention of your Quote when I said it before Chris.

Have you a link or direct me to that as the Institutions/Societies/Banks said they were NOT sending them any info.
Cheers Andrew

All financial institutions are required by law to report to HMRC interest paid to accounts. This information is reported at the end of the tax year and is required to be submitted by the end of June. This law dates back to the Taxes Management Act 1970 and has subsequently been replaced by legislation in the Finance Act 2011.

andy_poulton

Thanks Pollymaff.
Well Coventry said no.
Therefore advice taken and I will send secure messages to all asking

"I want you to supply Certificates of Interest for the Financial Year ending 5th April 2017 for all my accounts that have earned interest during that financial year.

Great idea
Cheers Andrew

polymaff

andy_poulton wrote: »

Thanks Pollymaff.
Well Coventry said no.
Therefore advice taken and I will send secure messages to all asking

"I want you to supply Certificates of Interest for the Financial Year ending 5th April 2017 for all my accounts that have earned interest during that financial year.

Great idea
Cheers Andrew

Don't forget to wait until 6th April, Andy, before you do!

talexuser

I started off with no interest (presumably from the previous system), went to my online personal tax account and declared several thousand from my spreadsheet calculated to the end of this tax year. That same figure was carried over to 2017/18, so I went back in online and took it down by a calculated several thousand since bought unwrapped investments to take advantage of the new dividend allowance and will pay off the remainder of a 0% new car loan this year. Both figures have been accepted without question.

Pincher

talexuser wrote: »

Both figures have been accepted without question.

This is what freaks me out. They are taking so much on trust.

There is so much scope for mis-reporting. New accounts don't seem to use National Insurance number, so how do they know it's ME? Believe it or not, HSBC Premier spelt my first name wrong, and it took three months to sort out.

Unlike me, some people move around, so John Smith of address A and John Smith of address B can get confused.

I dread filing £4,000 , and they accuse me of under-reporting, because they see £6,000 somehow.