Bank interest on self assessment

thenap80

Total income on which tax is due (which includes my dividend and bank interest)
£34,800.00

Savings interest from banks or building societies, securities etc.
Nil rate £42.00 x 0% £0.00

Dividends from companies etc
Higher rate at nil rate £33.00 x 0% £0.00

Total income on which tax has been charged
£34,800.00

So the 42 and 33 has not been taken off the total so gets taxed!

How so?

Pennywise

thenap80 wrote: »

Total income on which tax is due (which includes my dividend and bank interest)
£34,800.00

Savings interest from banks or building societies, securities etc.
Nil rate £42.00 x 0% £0.00

Dividends from companies etc
Higher rate at nil rate £33.00 x 0% £0.00

Total income on which tax has been charged
£34,800.00

So the 42 and 33 has not been taken off the total so gets taxed!

How so?

Your figures show they're taxed at 0% which is what was said by other posters earlier.

kuratowski

This thread should be mandatory reading for the Chancellor of the Exchequer and all the boffins at HM Treasury before each budget. The tax system is needlessly and dangerously over-complicated.

Dazed_and_confused

Total income on which tax is due (which includes my dividend and bank interest)
£34,800.00

Savings interest from banks or building societies, securities etc.
Nil rate £42.00 x 0% £0.00

Dividends from companies etc
Higher rate at nil rate £33.00 x 0% £0.00

Total income on which tax has been charged
£34,800.00

So the 42 and 33 has not been taken off the total so gets taxed!

How so?

Why do you think it would be taken off the total?

That income, the £33 and the £42 is taxable income.

You have no spare Personal Allowance so the £33 and the £42 is chargeable to tax.

The tax rate for the £33 and the £42 is 0%.

So the tax actually payable on the £33 and the £42 is £0.00.

I don't know what more anyone can say.

00ec25

thenap80 wrote: »

So the 42 and 33 has not been taken off the total so gets taxed!

correct it gets taxed

IT GETS TAXED AT 0%

£33 x 0% = 0

£42 x 0% = 0

Look at the details of the calculation, as a higher rate taxpayer surely you can follow the basic sums and see for yourself how the tax you pay is actually worked out as it is clearly set out for you on the calculation page?

thenap80

I am obviously coming across a bit of a clown and yes, it is overly complicated.

But on one hand I am told my interest is not taxed. Or worded differently, taxed at 0%.

But at the same time, it is then included in the collective sum that is to be taxed. That is to say, £75 (33+42) is not taken off the total 34,800 which is to be taxed as income tax.

Dazed_and_confused

But on one hand I am told my interest is not taxed

Whoever told you that is wrong. Or is unaware you have £34k of other income.

That is to say, £75 (33+42) is not taken off the total 34,800 which is to be taxed as income tax

Just out of interest when you look at the remainder of the income being taxed does it by chance add up to £34,725???

£34,725 taxed at, I would hazard a guess, 20%.

And £75 taxed at 0%.

Please tell us what is wrong with that???

00ec25

thenap80 wrote: »

But at the same time, it is then included in the collective sum that is to be taxed. That is to say, £75 (33+42) is not taken off the total 34,800 which is to be taxed as income tax.

you have simply not understood (read?) enough

your taxable income is not a single total
it is made up of several components, where in certain cases, each competent may be subject to separate tax rates and rules, hence interest gets a 0% band that varies if your total taxable income makes you a higher rate rather than a basic rate tax payer. It is the total taxable income that decides the banding, but it is not the total that gets taxed, it is the component that gets taxed

if you refuse to accept those facts there is nothing more to say other than get a tax book and read how tax works

thenap80

Had a real good look at the figures and totals. It seems that I have not been charged tax on my interest and dividend payment. I think the confusion came from reading it was taxable, and seeing it in the taxable figure. But although it is taxable, it is not taxed, or alternatively, taxed at zero percent.

Thanks very much though people for bearing with me. I'm off to buy a pair of clown shoes now as well as a book on taxes.

If I buy a book on taxes, is it tax deductable?!!!

Dazed_and_confused

I think you could claim 0% of the book as an expense