No tax to pay on income of 10K From Savings

Joey122

Has anyone else had a letter from HMRC saying :

"You need to fill in a tax return if you recieve more then 10K from savings / investments"

Does this mean that if you receive 9K in interest from savings you dont have to pay the additional 18% tax (higher rate tax payer), if you dont fill in a tax return?

Debt_Free_Chick

No. It's a basic principle of tax law that we all have to own up to any tax we need to pay.

If you know that tax is due on your savings, you have to declare it - whether or not HMRC send you a tax return. So if they don't send you one, you'll need to declare it to HMRC anyway.

Murdina

the other side of this is that they will code in up to 10k of investment income ie so you do not have to bother with the complications of a self-assessment return.

ManAtHome

I'd go for the complications - if they code it, you're paying the additional tax earlier than you need to.

As Debt_Free_Chick said, you're responsible for paying the extra (20% by the way - savings tax is 20%). The Revenue can turn up at any time and bill you for x years plus penalties plus interest.

dragon47

Does anyone know if this 10K limit applies to income gained after the basic 20% tax has been duducted or before?

Mikeyorks

It's the gross interest figure (ie before 20% tax deduction at source)