Top Bank Accounts Discussion Area

Steve_xx

castle96 wrote: »

had the 'same' letter from Halifax..

"we are unable to register....to receive interest without the tax taken off as this a/c does not earn interest. The reward value....is a reward payment and not interest.
In order to reclaim tax already deducted......send enclosed R40 to HMRC.."

So you can't receive gross interest/payment, but you can recalim the tax deducted

As far as I'm aware the Halifax Reward is actually £6.25, but they deduct 20% to leave £5 reward?

polymaff

grumbler wrote: »

Is there any difference between 'income' and 'interest'?

A significant difference since 6th April 2015 - even more so after 6th April 2016.

polymaff

Steve_xx wrote: »

As far as I'm aware the Halifax Reward is actually £6.25, but they deduct 20% to leave £5 reward?

It'll be interesting to see how Halifax and Barclays pay Rewards after 6th April 2016.

arbster

polymaff wrote: »

A significant difference since 6th April 2015 - even more so after 6th April 2016.

As there's no direct link between the capital invested and the "interest" paid, Halifax and Barclays incentive schemes surely must count as income and be taxed accordingly? I'm really not sure how I'll record this on my self-assessment tax return though...

Steve_xx

arbster wrote: »

As there's no direct link between the capital invested and the "interest" paid, Halifax and Barclays incentive schemes surely must count as income and be taxed accordingly? I'm really not sure how I'll record this on my self-assessment tax return though...

These are the details:


YOUR BENEFITS AT A GLANCE
.
Your Halifax Reward Current Account comes with great features to make looking after your money nice and easy. So here they all are, right up front.
*£5 reward paid in the following calendar month if in the previous calendar month you pay in to your account £750 or more and pay out of your account a minimum of two different direct debit mandates and keep your account in credit all calendar month. You also need to keep your account open or not change it to a different type of current account before the reward payment is due to be paid into your account. This payment is ‘net’ of income tax, which means we pay it after taking off income tax at the rate set by law (currently 20%). If you’re a higher-rate taxpayer, you may have to pay extra income tax on the reward payment. (The gross amount is £6.25. This is the amount before income tax is taken off.

You can see these details on page 5, here:

http://static.halifax.co.uk/assets/pdf/bankaccounts/pdf/reward-current-account-guide.pdf

polymaff

arbster wrote: »

As there's no direct link between the capital invested and the "interest" paid, Halifax and Barclays incentive schemes surely must count as income and be taxed accordingly? I'm really not sure how I'll record this on my self-assessment tax return though...

I'd agree with that - but in that case is the Barclays £3 fee offsetable against the income? Particularly if one uses no other part of the Blue Reward offering, that £3 meets the "wholly and necessarily incurred" test, I'd have thought.

arbster

On the self-assessment question, it probably comes under the "other taxable income" section.

polymaff wrote: »

I'd agree with that - but in that case is the Barclays £3 fee offsetable against the income? Particularly if one uses no other part of the Blue Reward offering, that £3 meets the "wholly and necessarily incurred" test, I'd have thought.

You're right on this one, of course. If the payments are "income" then it would be nice to think that the fee ought to be offsettable, but it's unlikely the HMRC would allow it.

paulmon

Hello, new to the forums and hoped for some advise please,

I've been reading the bank offers section.

I have an old Santander account - from which I switched my current account about 4 years. The original Santander account is still live, I get statements & can log on online. Can I use this account to get the M&S offer, as it requires no pay-in or direct debits? Getting the vouchers for nothing basically.

Thanks

grumbler

Check this long thread:
Free M&S current account - £100 in M&S vouchers if you switch

DragonQ

Steve_xx wrote: »

As far as I'm aware the Halifax Reward is actually £6.25, but they deduct 20% to leave £5 reward?

Correct. You can claim back £15 a year using an R40 if you're a non-tax payer. In the past I just put it in the "interest" section of the form and included print-outs of the Halifax statements with the "REWARD (NET)" lines highlighted.

Why Halifax can't just pay it gross is beyond me. Probably just can't be bothered to implement this for such a small number of customers.