Exceeding the Personal Savings Allowance

wiseonesomeofthetime

I only have interest income, so sounds like might be a plan then. Cheers

eskbanker

wiseonesomeofthetime said:

I just wish they would say, "You owe x amount of tax on your interest earned in y tax year?" and allow me to pay that off direct, thus not messing around with my tax code each year.

wiseonesomeofthetime said:

I only have interest income, so sounds like might be a plan then. Cheers

If your only income is from interest then surely your tax code is irrelevant, as it's only used as a mechanism to drive PAYE deductions?

Bigwheels1111

wiseonesomeofthetime said:

I only have interest income, so sounds like might be a plan then. Cheers 

You only have 2 thing to worry about one is going over 10k, then you need to fill out a self assessment form and that’s very easy.
Two, going over £18,500k. Then you will pay tax at 20%.

I do a return every year and takes me under 15 minutes.

Dazed_and_C0nfused

eskbanker said:

wiseonesomeofthetime said:

I just wish they would say, "You owe x amount of tax on your interest earned in y tax year?" and allow me to pay that off direct, thus not messing around with my tax code each year.

wiseonesomeofthetime said:

I only have interest income, so sounds like might be a plan then. Cheers

If your only income is from interest then surely your tax code is irrelevant, as it's only used as a mechanism to drive PAYE deductions?

Correct.  There needs to be a PAYE source of income (employment, pension (other than the State Pension) for a tax code to be calculated and used.

And if that is the only income then tax will only actually be payable if it exceeds £17,310 (Marriage Allowance applicant) or £18,570.

Assuming the interest isn't over £50,270!

Irrespective of any tax payable though a Self Assessment return is required if the interest is £10k or more.

wiseonesomeofthetime

eskbanker said:

wiseonesomeofthetime said:

I just wish they would say, "You owe x amount of tax on your interest earned in y tax year?" and allow me to pay that off direct, thus not messing around with my tax code each year.

wiseonesomeofthetime said:

I only have interest income, so sounds like might be a plan then. Cheers

If your only income is from interest then surely your tax code is irrelevant, as it's only used as a mechanism to drive PAYE deductions?

Perhaps I should have been clearer. My only income from the list provided in the referring post was interest.

I have pension income, so it does affect my tax code each year.

It only messes with the monthly pension by about £10 or so, so not a major drama. Just a personal preference.