Foreign bank interest on tax return

anaprag

Hello,

Is untaxed foreign bank interest income on the tax return covered by any of the allowances like the basic personal allowance or the personal savings allowance?

I did a search but couldn't find clear information specifically about untaxed foreign bank interest.

Thanks

masonic

How about this thread where the poster helpfully deleted her question and response, but a thorough answer is given at the end: https://forums.moneysavingexpert.com/discussion/comment/72609014#Comment_72609014

anaprag

Thank you, that is helpful. That post talks about the personal savings allowance. I do my tax return as I am self employed - my self employment earnings are below £1k though, and my UK and foreign interest combined is around £5k. So my interest is above the £1k personal savings allowance. But would I need to pay any tax as I have read about the allowances: first the personal allowance (£11,850 for 2018-19), then the £5,000 starting savings rate at 0%, and finally the personal savings allowance worth up to £1,000.

Would the remaining interest income, which includes foreign interest, be covered by the starting savings rate?

Dazed_and_confused

The Personal Savings "Allowance" doesn't really exist in the way you think.

It is actually a 0% tax rate (the savings nil rate) and it is not available for lower income individuals to use.

Most people have to have income (in 2018:19) in excess of £16,850 before the savings nil rate benefits them.

Before that their is the Personal Allowance and savings starter rate of tax, where upto £5,000 of savings interest is also taxed at 0%.

Dazed_and_confused

Are you trying to file a return online?

masonic

anaprag wrote: »

Thank you, that is helpful. That post talks about the personal savings allowance. I do my tax return as I am self employed - my self employment earnings are below £1k though, and my UK and foreign interest combined is around £5k. So my interest is above the £1k personal savings allowance. But would I need to pay any tax as I have read about the allowances: first the personal allowance (£11,850 for 2018-19), then the £5,000 starting savings rate at 0%, and finally the personal savings allowance worth up to £1,000.

Would the remaining interest income, which includes foreign interest, be covered by the starting savings rate?

The main point made is that foreign interest is treated in the same manner as UK interest for tax purposes, so would be covered in your personal allowance and the starter savings rate or personal savings allowance above that.