Annual Interest Tax statements - chase for?

masonic

ANGLICANPAT said:

Sea_Shell said:

Do any of you actively chase up all your interest tax statements from your various providers each year?   Or only those of you who need to complete a self-assessment return?

I have my own records of what interest we've earned in any given tax year, and if we receive an annual tax statement i keep it in the folder for that year, and tick it off my own spreadsheet printout.

Due to low rates of late, we're no longer at risk of breaching the £1000 tax free limit again (we have in the past, but whilst still keeping within overall income tax free limits), so doesn't it really not matter if we don't receive all the statements for 20-21.

Is it still a bit early to have had them all in?

I only ask, as we're looking to close down (most of) our TSB accounts, and I've been on and found the tax certificates in documents for some of the accounts, but not all, as if they've not been generated yet.   

, I closed my account with  TSB  forgetting I'd need to print off tax returns , but  that action removed all online access immediately , so no chance to retrieve anything later . Had to ring to get the figures . Not confident that if Id tried to go back and get figures by tel.  belatedly  eg for a taxman query  , that  they would be  available to me , probably not literally freely, anyway. So Id say with this bank , it might not be standard to kill off your access immediately on closure, I dont know,   but it obviously can  happen , so for the sake of  a quick print off now,  Id do it just in case. 

There may be some value to opening a stand-alone savings account with those banks you leave temporarily, so as to retain some level of access. This will normally not prevent you from taking up an incentive in the future, allows continued access to online documents, and potentially easier application for a new product if something sufficiently attractive comes along.

colsten

masonic said:

ANGLICANPAT said:

Sea_Shell said:

Do any of you actively chase up all your interest tax statements from your various providers each year?   Or only those of you who need to complete a self-assessment return?

I have my own records of what interest we've earned in any given tax year, and if we receive an annual tax statement i keep it in the folder for that year, and tick it off my own spreadsheet printout.

Due to low rates of late, we're no longer at risk of breaching the £1000 tax free limit again (we have in the past, but whilst still keeping within overall income tax free limits), so doesn't it really not matter if we don't receive all the statements for 20-21.

Is it still a bit early to have had them all in?

I only ask, as we're looking to close down (most of) our TSB accounts, and I've been on and found the tax certificates in documents for some of the accounts, but not all, as if they've not been generated yet.   

, I closed my account with  TSB  forgetting I'd need to print off tax returns , but  that action removed all online access immediately , so no chance to retrieve anything later . Had to ring to get the figures . Not confident that if Id tried to go back and get figures by tel.  belatedly  eg for a taxman query  , that  they would be  available to me , probably not literally freely, anyway. So Id say with this bank , it might not be standard to kill off your access immediately on closure, I dont know,   but it obviously can  happen , so for the sake of  a quick print off now,  Id do it just in case. 

There may be some value to opening a stand-alone savings account with those banks you leave temporarily, so as to retain some level of access. This will normally not prevent you from taking up an incentive in the future, allows continued access to online documents, and potentially easier application for a new product if something sufficiently attractive comes along.

Online access very rarely gives you access to the details of closed accounts. You can always use a SAR to get at old data, for about 5-7 years after closure, but it is much easier to capture potentially critical info before you close accounts, or before they get closed e.g. in the case of Regular Savers.

zagfles

Even if no tax is due on the interest you might need to declare it, for instance if you have to do a tax return (you can't just leave it off because no tax is due on it), or if you have kids at uni and they assess your income, or if you want to claim a tax rebate for reasons unrelated to interest etc.

masonic

colsten said:

masonic said:

ANGLICANPAT said:

Sea_Shell said:

Do any of you actively chase up all your interest tax statements from your various providers each year?   Or only those of you who need to complete a self-assessment return?

I have my own records of what interest we've earned in any given tax year, and if we receive an annual tax statement i keep it in the folder for that year, and tick it off my own spreadsheet printout.

Due to low rates of late, we're no longer at risk of breaching the £1000 tax free limit again (we have in the past, but whilst still keeping within overall income tax free limits), so doesn't it really not matter if we don't receive all the statements for 20-21.

Is it still a bit early to have had them all in?

I only ask, as we're looking to close down (most of) our TSB accounts, and I've been on and found the tax certificates in documents for some of the accounts, but not all, as if they've not been generated yet.   

, I closed my account with  TSB  forgetting I'd need to print off tax returns , but  that action removed all online access immediately , so no chance to retrieve anything later . Had to ring to get the figures . Not confident that if Id tried to go back and get figures by tel.  belatedly  eg for a taxman query  , that  they would be  available to me , probably not literally freely, anyway. So Id say with this bank , it might not be standard to kill off your access immediately on closure, I dont know,   but it obviously can  happen , so for the sake of  a quick print off now,  Id do it just in case. 

There may be some value to opening a stand-alone savings account with those banks you leave temporarily, so as to retain some level of access. This will normally not prevent you from taking up an incentive in the future, allows continued access to online documents, and potentially easier application for a new product if something sufficiently attractive comes along.

Online access very rarely gives you access to the details of closed accounts. You can always use a SAR to get at old data, for about 5-7 years after closure, but it is much easier to capture potentially critical info before you close accounts, or before they get closed e.g. in the case of Regular Savers.

I've found with Lloyds group, closing the last account prevents you being able to log in at all, so it is no longer possible to access your online inbox. Opening a new account restores access - when I did this with Lloyds I discovered a closing statement (complete with tax statement) and a couple of letters I had no way to access while I held no accounts.

Sea_Shell

OP here.

Well, it's a good job I kept my own records of all savings interest paid to us both, as HMRC have asked for clarification of the interest paid by DH, for the 20/21 tax year, before they can process his P50Z tax rebate form for 21/22.

I've only actually received about half of the tax certificates he may need.

He did actually earn £1600, but as he had no other taxable income that year, it will not be subject to tax.  

Unfortunately, if they then then use this figure and "assume" he'll get the same in 21/22, then that's going to mess it up, as he's due to only get £600 of interest in this tax year.

But I suppose they can't close off 20/21, without this information.

It's from 12 different account, most of which have now matured, and not been replaced.

GeoffTF

I do not wait for tax statements. I log in to each account when an interest payment is due and record the amount and the new balance. If a term account matures, I calculate the interest payment by subtracting the previous balance from the final payment. I have got over a dozen accounts. Chasing tax certificates would be a real pain. HMRC should get the same numbers. There is a consultation on automatically populating interest payments on tax returns. The main problem appears to be identifying the holder of each account. The banks will not necessarily have your National Insurance number, for example. It would make my life easier if these payments were automatically populated, and the default option was always to return all my money to my nominated account on maturity.

masonic

GeoffTF said:

I do not wait for tax statements. I log in to each account when an interest payment is due and record the amount and the new balance. If a term account matures, I calculate the interest payment by subtracting the previous balance from the final payment. I have got over a dozen accounts. Chasing tax certificates would be a real pain. HMRC should get the same numbers. There is a consultation on automatically populating interest payments on tax returns. The main problem appears to be identifying the holder of each account. The banks will not necessarily have your National Insurance number, for example. It would make my life easier if these payments were automatically populated, and the default option was always to return all my money to my nominated account on maturity.

That's all well and good and I tend to do the same for providers who unhelpfully fail to provide the necessary documents, but how do you deal with providers that treat interest as having been paid at different intervals than credited to your account? For example, Zopa credit interest monthly on their fixed term accounts, but declare all of the interest as having been paid at maturity. If you go by statements you'd be attributing interest to the wrong tax year with such a provider. Other providers do not make it clear how they treat interest payments that are added to the balance of a fixed term account that are not available to be withdrawn.

GeoffTF

masonic said:

GeoffTF said:

I do not wait for tax statements. I log in to each account when an interest payment is due and record the amount and the new balance. If a term account matures, I calculate the interest payment by subtracting the previous balance from the final payment. I have got over a dozen accounts. Chasing tax certificates would be a real pain. HMRC should get the same numbers. There is a consultation on automatically populating interest payments on tax returns. The main problem appears to be identifying the holder of each account. The banks will not necessarily have your National Insurance number, for example. It would make my life easier if these payments were automatically populated, and the default option was always to return all my money to my nominated account on maturity.

That's all well and good and I tend to do the same for providers who unhelpfully fail to provide the necessary documents, but how do you deal with providers that treat interest as having been paid at different intervals than credited to your account? For example, Zopa credit interest monthly on their fixed term accounts, but declare all of the interest as having been paid at maturity. If you go by statements you'd be attributing interest to the wrong tax year with such a provider. Other providers do not make it clear how they treat interest payments that are added to the balance of a fixed term account that are not available to be withdrawn.

I had assumed that interest is considered to be paid for tax purposes when it is credited to my account. I was wrong. I have found "SAIM2440 - Interest: taxation of interest: when interest arises".

"Example 2

Sam entered into a five year fixed-term bond on 6 April 2017.  The bond credits interest to Sam’s account annually on the 31 December.  Sam can only gain access to both the annual interest and the principal in advance of 5 April 2022 if a penalty is paid for early access.

Since the terms and conditions of the bond allow Sam to draw on the funds, although with a penalty, the interest arises and is taxable each year as it is credited.

If the terms and conditions of the bond did not allow access until maturity, the interest would arise and be taxed at that point."

It looks like I have got some fixing to do.

Notepad_Phil

GeoffTF said:

masonic said:

GeoffTF said:

I do not wait for tax statements. I log in to each account when an interest payment is due and record the amount and the new balance. If a term account matures, I calculate the interest payment by subtracting the previous balance from the final payment. I have got over a dozen accounts. Chasing tax certificates would be a real pain. HMRC should get the same numbers. There is a consultation on automatically populating interest payments on tax returns. The main problem appears to be identifying the holder of each account. The banks will not necessarily have your National Insurance number, for example. It would make my life easier if these payments were automatically populated, and the default option was always to return all my money to my nominated account on maturity.

That's all well and good and I tend to do the same for providers who unhelpfully fail to provide the necessary documents, but how do you deal with providers that treat interest as having been paid at different intervals than credited to your account? For example, Zopa credit interest monthly on their fixed term accounts, but declare all of the interest as having been paid at maturity. If you go by statements you'd be attributing interest to the wrong tax year with such a provider. Other providers do not make it clear how they treat interest payments that are added to the balance of a fixed term account that are not available to be withdrawn.

I had assumed that interest is considered to be paid for tax purposes when it is credited to my account. I was wrong. I have found "SAIM2440 - Interest: taxation of interest: when interest arises".

"Example 2

Sam entered into a five year fixed-term bond on 6 April 2017.  The bond credits interest to Sam’s account annually on the 31 December.  Sam can only gain access to both the annual interest and the principal in advance of 5 April 2022 if a penalty is paid for early access.

Since the terms and conditions of the bond allow Sam to draw on the funds, although with a penalty, the interest arises and is taxable each year as it is credited.

If the terms and conditions of the bond did not allow access until maturity, the interest would arise and be taxed at that point."

It looks like I have got some fixing to do.

Hopefully not too much fixing as I would have thought that most fixed-term products allowed the option of annually (or even monthly) paying the interest out, and so even if you didn't choose that option then any taxation of interest would happen in the year that the interest was credited as the terms and conditions did allow access before maturity, you just chose not to.

Sea_Shell

DHs 5 year Yorkshire Bank savings bond added all interest at maturity, as no early access allowed (unless you died!).

No interim account statements were produced.

However, they did issue annual interest statements, so it did actually credit annually.

Good job, as it would have been £6000 odd in one hit!!