Top Bank Accounts Discussion Area

polymaff

DragonQ wrote: »

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.

Roll on next April

DragonQ

polymaff wrote: »

Roll on next April

Will all banks switch to paying interest and rewards gross then? I mean I know about the £1000 tax-free savings interest thing but I don't remember seeing anything about how it will work in practice.

I'm probably just over that limit, which means I'll have to fill in some form each year to pay HMRC a small sum. Bit annoying but better than paying 20% on the lot I guess.

polymaff

DragonQ wrote: »

Will all banks switch to paying interest and rewards gross then? I mean I know about the £1000 tax-free savings interest thing but I don't remember seeing anything about how it will work in practice.

http://paullewismoney.blogspot.co.uk/2015/03/savings-revolution.html

... and I hope that this will include the Halifax Reward - just for consistency - if nothing else. The similar Barclays Blue Reward appears to be paid without any tax deduction.

As for the Personal Savings Allowance which comes in at the same time, it should be straightforward enough for those who fill in a self-assessment form already. Otherwise, who knows? HMRC seemed to have been pushing for LESS gross interest payments but now appear to have been re-directed in the opposite direction by the Treasury. HMRC told me that their move against gross payment was to keep down the number of savers they needed to push into self-assessment, so now, will there be even more - or will implementation of the new policy:

https://www.gov.uk/government/publications/making-tax-easier

eventually solve all of our problems!

And, of course, it is all subject to this week's budget.

ernie-money

DragonQ wrote: »

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.

I still don't quite understand why you can reclaim the tax using an R40, but it's not possible to complete an R85 to not have the tax deducted in the first place..? Seems inconsistent...?

polymaff

ernie-money wrote: »

I still don't quite understand why you can reclaim the tax using an R40, but it's not possible to complete an R85 to not have the tax deducted in the first place..? Seems inconsistent...?

R85 is "to tell your bank or building society you qualify for tax-free interest on your account." The Halifax Reward is not interest.

ernie-money

polymaff wrote: »

R85 is "to tell your bank or building society you qualify for tax-free interest on your account." The Halifax Reward is not interest.

Yes, I know, hence my question why you can use the R40 form to get the tax back. An R40 is used to claim back tax deducted from savings and investments, so if it isn't interest, how can you do this?

polymaff

ernie-money wrote: »

Yes, I know, hence my question why you can use the R40 form to get the tax back. An R40 is used to claim back tax deducted from savings and investments, so if it isn't interest, how can you do this?

R40 is used to make a "claim for repayment of tax deducted from savings and investments". As in my previous post, this is a direct quote from HMRC. Claiming tax back on interest paid is only one of a number of circumstances for which form R40 is applicable.

Halifax have been a PITA over this. Hopefully it all gets resolved next April. Until then you have an non-savings income of £6.25 gross per month and Halifax have decided to assume you are on a BR tax code and have deducted £1.25 from your funds - it seems.

Diglea

Posting on behalf of a friend:
I'd like to take advantage of this offer BUT
1) I already have a First Direct account - As First Direct is a part of HSBC does this preclude me from taking advantage of this offer? (I wouldn't have thought so as I presume they're treated as separate entities for this purpose, but thought best to check if anyone else has had issues with this
And, most importantly
2) Although I want to "switch from" the first direct account (I also have a couple of other current accounts that I keep for insurance benefits etc) I DO NOT want to close the First Direct account (I have a regular savings account with 6% interest that I use to save for the kids which doesn't mature for another 6 months amongst other things). I don't mind the direct debits and my pay being transferred over though if need be.
So, the question is, can I take advantage of this offer WITHOUT closing the First Direct account?
The MSE article would suggest it may be possible though I'm is not decisive:
"Do I HAVE to close my old account when switching?
Your new bank will automatically close down your old account as part of the seven-day switching process. If you'd rather keep it open, you can still opt for the older, longer service. This takes 18 to 30 working days and offers no guarantees if anything goes wrong." (I had inserted a link to the article but won't let me post with links as I'm a new user)

I'm sure this question must have been asked before both in general terms in taking advantage of the many switching current account offers, as I'm sure lots of other people have a reason for keeping one or two other accounts too like me.

Does anyone have any answers (in general terms on the way these switching offers work & specifically with regard to the HSBC latest offer)???

Please excuse any forum faux pas' ... I'm a novice forumite!:)

YorkshireBoy

Diglea wrote: »

Posting on behalf of a friend:

Posting on behalf of HSBC...

As First Direct is a part of HSBC does this preclude me from taking advantage of this offer?

So, the question is, can I take advantage of this offer WITHOUT closing the First Direct account?

No and no (unless they switch a different account of course!), according to the switching offer T&Cs on their website (which your friend could/should read if considering switching).

Steve_xx

Diglea wrote: »

Posting on behalf of a friend:
I'd like to take advantage of this offer BUT
1) I already have a First Direct account - As First Direct is a part of HSBC does this preclude me from taking advantage of this offer? (I wouldn't have thought so as I presume they're treated as separate entities for this purpose, but thought best to check if anyone else has had issues with this
And, most importantly
2) Although I want to "switch from" the first direct account (I also have a couple of other current accounts that I keep for insurance benefits etc) I DO NOT want to close the First Direct account (I have a regular savings account with 6% interest that I use to save for the kids which doesn't mature for another 6 months amongst other things). I don't mind the direct debits and my pay being transferred over though if need be.
So, the question is, can I take advantage of this offer WITHOUT closing the First Direct account?
The MSE article would suggest it may be possible though I'm is not decisive:
"Do I HAVE to close my old account when switching?
Your new bank will automatically close down your old account as part of the seven-day switching process. If you'd rather keep it open, you can still opt for the older, longer service. This takes 18 to 30 working days and offers no guarantees if anything goes wrong." (I had inserted a link to the article but won't let me post with links as I'm a new user)

I'm sure this question must have been asked before both in general terms in taking advantage of the many switching current account offers, as I'm sure lots of other people have a reason for keeping one or two other accounts too like me.

Does anyone have any answers (in general terms on the way these switching offers work & specifically with regard to the HSBC latest offer)???

Please excuse any forum faux pas' ... I'm a novice forumite!:)

Some of the clue here is that the incentive is for 'switching' your account from an existing provider to HSBC, using the switching process which closes the old account at the end of that process!