Interest details on HMRC Personal Tax Account online

Dazed_and_confused

Does it all reset in the new tax year?

I would appreciate if someone could clarify. I have been paying basic rate 20% for most of the tax year, in March due to some bonuses my earnings go over to the 40% tax band. I assume that I will pay 40% on March's salary (i.e. money earned over the threshold), when the new tax year starts in April, will I go back to 20% basic?

You should be on a cumulative tax code in April and your tax will be based on what you earn in that one month. So if it's say £2,500 taxable pay that is equivalent to £30k annual income so if you are on the standard emergency tax code of 1250L on a cumulative basis then you will only pay 20% tax.

Then in May it will be reviewed again so if say you got a bonus of £4,000 plus normal salary of £2,500 your total taxable pay after two months would be £9,000. Which is equivalent to £54k annual income so you would pay some higher rate tax in May.

But then in June you just get your normal £2,500 taxable salary. So your total taxable income after 3 months is £11,500. Which is equivalent to £46k annual income. So when your tax is calculated in June you would not need to pay any higher rate tax and you would effectively get the higher rate tax deducted in May refunded by not having as much tax deducted as would be normal for taxable salary of £2,500.

All this assumes you aren't Scottish resident for tax purposes and are currently on tax code 1185L, which will normally become 1250L in April