Bank interest on self assessment

thenap80

So I'm doing my last minute self assessment tax return. I am employed PT but let out one property so need to do this.

I have about £33.00 bank interest from my current account to add on.
I have a £30.00 dividend payment that I received also.

Now I've read there is a personal allowance for these which is separate from my employed income tax threshold.

I am a basic rate tax payer

When doing my return though it says that the bank interest is taxed at 0 percent as well as the dividend......but then seems to still include these amounts in the TOTAL taxable income.

How so?

BoGoF

It is not a tax allowance....it is a 0 per cent rate for savings income up to a certain anount, depending on your income.

thenap80

So, when I include the small amount of interest (that I've earned in my current account) on my total income, it rightly gets taxed at 20 percent?

thenap80

A bit like Premium Bonds - am I supposed to declare prizes as I thought they were tax free. By looks of it, including these on self assesssment, they would ultimately be taxed (at 20percent for me)

[Deleted User]

thenap80 wrote: »

A bit like Premium Bonds - am I supposed to declare prizes as I thought they were tax free. By looks of it, including these on self assesssment, they would ultimately be taxed (at 20percent for me)

Have you looked at the actual calculation? And, no, nothing like premium bonds which do not go on your return. There is a difference between 0% rate and tax free.

speedyrite

You don’t have to declare Premium Bond prizes on your SATR.

thenap80

ACTUALLY....just noticed I have £1000 of my income that just encroaches onto higher rate tax of 40percent....

Does this mean I pay tax on savings interest and I don't get a 1k allowance?

BoGoF

How many times....there is no allowance. It is taxable income but at 0% on £1000 if basic rate and 0% on £500 if higher rate. The savings income is taken into account for calculating liability to HR tax.

thenap80

So being a higher rate tax payer (just) I should be allowed up to £500 not to be taxed. I only took about forty pounds interest...but after it shows nil rate on the breakdown, it goes onto include it in the Total Income to be taxed.

How so?

thenap80

Is it correct then that my small amount of bank interest is taxed?

Dazed_and_confused

The interest and dividends declared are part of your taxable income.

And if your other income is over the Personal Allowance then yes you would be taxed on both the interest and the dividends.

But the tax rate on the interest and dividends (for the amount you quoted in your op) would be 0%.

So taxed yes. But the amount of tax due on that income is £0.

I'm not sure you have actually fully read your Self Assessment.

Does it show £33 interest taxed at 0%?
Does it show dividend of £30 taxed at 0%?