Over 60 housewife with 80 K savings, once I earn over 1K interest, is t

allegro120

eskbanker said:

allegro120 said:

molerat said:

allegro120 said:

pw23 said:

I have 80 K in an easy access savings account and I understand I can earn £1000 interest per tax year, tax free, but once I go over this level I understand I will need to start paying income tax 

As I have always been a unemployed housewife, I am unsure about what my requirements would be once I earn over 1K


Am I right in thinking I would then need to declare myself self-employed and fill out the PAYE documents/returns


As if this is the case, I don't want to be burdened with all of this as it overwhelms me

I already have some in a cash ISA so wouldn't be able to move much there

80k in an easy access will generate interest at around 3k.  In your circumstances you are allowed to earn up to 6k in interest without paying tax on it, so you don't need to declare  or fill out anything.

How do you come to that conclusion ?  As correctly stated above they may be able to earn up to £18570 in interest without paying tax but nothing they have stated gives more credence to either figure.

1. £80k in an easy access account (whatever account it might be) is not likely to generate much more than £3k a year.
2. OP stated that she is not working, so I assumed there is no other personal income.
3. £5k(starting rate)+£1k(personal savings allowance)=£6k tax free allowance for savings so she doesn't need "to be burdened with all of this".

But you're missing the point that OP is also likely to have her entire £12,570 personal tax allowance, which can be used by savings interest income, and indeed must be used by it before either of the nil-rate bands comes into play, so the £18,570 figure is likely to be the correct answer....

The question was "Am I right in thinking I would then need to declare myself self-employed and fill out the PAYE documents/returns".  My answer is - no, you don't need to declare yourself self-employed and fill out self-assessment tax return form. She stated that she has 80k in an easy access account and didn't say that she is foreseeing any other income, so I don't think £18,570 figure is relevant to her query.

pw23

Thank you everyone for your replies, it is very helpful

eskbanker

allegro120 said:

eskbanker said:

allegro120 said:

molerat said:

allegro120 said:

pw23 said:

I have 80 K in an easy access savings account and I understand I can earn £1000 interest per tax year, tax free, but once I go over this level I understand I will need to start paying income tax 

As I have always been a unemployed housewife, I am unsure about what my requirements would be once I earn over 1K


Am I right in thinking I would then need to declare myself self-employed and fill out the PAYE documents/returns


As if this is the case, I don't want to be burdened with all of this as it overwhelms me

I already have some in a cash ISA so wouldn't be able to move much there

80k in an easy access will generate interest at around 3k.  In your circumstances you are allowed to earn up to 6k in interest without paying tax on it, so you don't need to declare  or fill out anything.

How do you come to that conclusion ?  As correctly stated above they may be able to earn up to £18570 in interest without paying tax but nothing they have stated gives more credence to either figure.

1. £80k in an easy access account (whatever account it might be) is not likely to generate much more than £3k a year.
2. OP stated that she is not working, so I assumed there is no other personal income.
3. £5k(starting rate)+£1k(personal savings allowance)=£6k tax free allowance for savings so she doesn't need "to be burdened with all of this".

But you're missing the point that OP is also likely to have her entire £12,570 personal tax allowance, which can be used by savings interest income, and indeed must be used by it before either of the nil-rate bands comes into play, so the £18,570 figure is likely to be the correct answer....

The question was "Am I right in thinking I would then need to declare myself self-employed and fill out the PAYE documents/returns".  My answer is - no, you don't need to declare yourself self-employed and fill out self-assessment tax return form. She stated that she has 80k in an easy access account and didn't say that she is foreseeing any other income, so I don't think £18,570 figure is relevant to her query.

£18,570 may not be directly relevant but at least it's accurate, unlike your £6K one that is neither....

ColdIron

pw23 said:

I have 80 K in an easy access savings account and I understand I can earn £1000 interest per tax year

That would be your Personal Savings Allowance

As I have always been a unemployed housewife, I am unsure about what my requirements would be once I earn over 1K

As you appear to have no income beyond savings interest you have more than the PSA available to you

1. Personal Allowance - £12,570
2. Starting Rate for Savings - £5,000
3. Personal Savings Allowance - £1,000

Am I right in thinking I would then need to declare myself self-employed and fill out the PAYE documents/returns

No. You are not self employed

When your interest from savings exceeds £18,570 pa it may be taxed but that seems unlikely on £80,000

See
https://www.gov.uk/apply-tax-free-interest-on-savings

badger09

pw23 said:

Dazed_and_C0nfused said:

And we do appear to have been here before!

https://forums.moneysavingexpert.com/discussion/6439557/over-60-and-dont-work-how-much-tax-do-i-have-to-pay-on-a-savings-account

Oh dear, looks like my age is showing

@pw23

Happens to most of us ‘of a certain age’ at some time. 

If you look at the top of your thread, to the right of your thread title, you’ll see a red ‘bookmark’. If you click on that, you’ll be able to save this whole thread & can look at it whenever you need to. 

HTH