Another Year and NS&I are still getting it wrong

polymaff

Thrugelmir said:

polymaff said:

Thrugelmir said:

Statement covers period to the 7th April 2021. Interest will therefore be credited the day after , i.e. the 8th April 2021. .

Same principle will apply to April 2020. 

Never wise to endlessly throw boomerangs. They have a nasty habit of coming back to hit you on the head when you least expect them to. 

You've got that entirely wrong.

When would expect the interest for the period ended the 7th April to be credited?  

 This is an account opened on the eighth. "We pay ... each month ... same day of the month as you bought your bond". So there is nothing wrong about the dating of the transactions shown.  The error is in ignoring one payment made within the date span quoted and in adding one that is outside of the date span quoted.

colsten

I have gone back over my records, and I never got taxed on more state pension than I actually received. I do, however, make annual self assessments - so may be the issue you describe exists for people who don't make SAs?

RG2015

polymaff said:

RG2015 said:

polymaff said:

newatc said:

Tax is paid on payments not what has been accrued. If the OP is saying he is being taxed on interest received after April 5 then I think he is correct.
I had a long argument with HMRC about the State Pension which they taxed me on the accrual (what I would have been paid if I received the pension weekly) and not what I was actually paid before the tax year end. I won the argument eventually.

This is one of the crazy anomalies of the tax system.

If I'd known about it beforehand, I, too, would have got them to pay the pension weekly.

I am planning on drawing my state pension next year. How exactly might it benefit me to elect for it to be paid weekly?

It just makes it easier to reconcile your and HMRC's understanding.  This is most relevant in your first (and, presumably, last) year of state pension.  The problem in reconciling is that HMRC and DWP refer you back and forth to each other.

Incidentally, in my first SP year HMRC prepopulated my SA with just a single week's SP payment - so about £115 instead a 4-figure sum.  The only prepopulated box - and they got it wrong by an order of magnitude.  (My birthday is in December!).

Many thanks @polymaff

I had to re-read your first comment in parenthesis, as I initially read it that I would be falling off my perch before I got to my second year of SP. 

newatc

colsten said:

I have gone back over my records, and I never got taxed on more state pension than I actually received. I do, however, make annual self assessments - so may be the issue you describe exists for people who don't make SAs?

Sounds about right.