Self Assessment for over £10,000 interest. Before or after tax?

Bigwheels1111

When I called HMRC late last year I was told.
Say 9k interest from fixed rate bond was ok.
The 2k from isa did not count, so did not need to be declared.
Thus only 9k interest and no self assessment.
As my interest has gone over 10k it’s a moot point now.
Hello self assessment return.

necronom

I've been through my accounts and I'm at £9k to the end of Jan (excluding ISAs), so I'm definitely going to have to register.  I hope it's not too painful filling it in.  They should to a video of what to do for all the extra people who are only going to be doing a tax return for interest this year.
I don't have any fixed length ones that only pay out at the end, so that makes it easier.
I still don't see why we even need to do this at all.  If they know what I've got in interest, why do I have to waste time telling them (and potentially missing something), when the banks let them know it all.  If I didn't do it they would fine me, so they know what I have, so what's the point?

Dazed_and_C0nfused

necronom said:

I've been through my accounts and I'm at £9k to the end of Jan (excluding ISAs), so I'm definitely going to have to register.  I hope it's not too painful filling it in.  They should to a video of what to do for all the extra people who are only going to be doing a tax return for interest this year.
I don't have any fixed length ones that only pay out at the end, so that makes it easier.
I still don't see why we even need to do this at all.  If they know what I've got in interest, why do I have to waste time telling them (and potentially missing something), when the banks let them know it all.  If I didn't do it they would fine me, so they know what I have, so what's the point?

Here's a couple for you from HMRC,

https://youtu.be/_N0ekIOnURM?si=og1mtKjH4hbUtJxz

https://youtu.be/JGLna1AzBWQ?si=0rlWl0l8mg_nTc4b

necronom

Thanks.
It looks like I'm going to have to fill in stuff for my job as well, even though I've never needed to do this before, and they already know all this.

Dazed_and_C0nfused

necronom said:

Thanks.
It looks like I'm going to have to fill in stuff for my job as well, even though I've never needed to do this before, and they already know all this.

A tax return is to declare all taxable income and claim any eligible deductions or reliefs.

charlie12525

necronom said:

I've been through my accounts and I'm at £9k to the end of Jan (excluding ISAs), so I'm definitely going to have to register.  I hope it's not too painful filling it in.  They should to a video of what to do for all the extra people who are only going to be doing a tax return for interest this year.
I don't have any fixed length ones that only pay out at the end, so that makes it easier.
I still don't see why we even need to do this at all.  If they know what I've got in interest, why do I have to waste time telling them (and potentially missing something), when the banks let them know it all.  If I didn't do it they would fine me, so they know what I have, so what's the point?

I was just looking at this yesterday as it looks like I will earn more than 10k in savings interest this tax year and will therefore have to do my first self assessment tax return.

I have quite a lot of bank/ building society accounts and have closed a fair number over the last year. I have everything recorded on a spreadsheet.

I thought I would have to fill in the tax return with details like bank name, account numbers etc.

I have searched, unsuccessfully, online for examples of a completed tax return.

The HMRC "notes" for how to complete a tax return seem to say that only a single figure is required for the total amount of untaxed interest and no further details are required. Is that the case?

Dazed_and_C0nfused

charlie12525 said:

necronom said:

I've been through my accounts and I'm at £9k to the end of Jan (excluding ISAs), so I'm definitely going to have to register.  I hope it's not too painful filling it in.  They should to a video of what to do for all the extra people who are only going to be doing a tax return for interest this year.
I don't have any fixed length ones that only pay out at the end, so that makes it easier.
I still don't see why we even need to do this at all.  If they know what I've got in interest, why do I have to waste time telling them (and potentially missing something), when the banks let them know it all.  If I didn't do it they would fine me, so they know what I have, so what's the point?

I was just looking at this yesterday as it looks like I will earn more than 10k in savings interest this tax year and will therefore have to do my first self assessment tax return.

I have quite a lot of bank/ building society accounts and have closed a fair number over the last year. I have everything recorded on a spreadsheet.

I thought I would have to fill in the tax return with details like bank name, account numbers etc.

I have searched, unsuccessfully, online for examples of a completed tax return.

The HMRC "notes" for how to complete a tax return seem to say that only a single figure is required for the total amount of untaxed interest and no further details are required. Is that the case?

Yes.

HMRC will write to you if they have any queries about your return.  They have 12 months I think to open an investigation.

eskbanker

charlie12525 said:
The HMRC "notes" for how to complete a tax return seem to say that only a single figure is required for the total amount of untaxed interest and no further details are required. Is that the case?

Yes, it's just a single box for one figure, but you'd need to be able to show evidence of your workings if there was a dispute between your version and theirs....

Olinda99

Dazed_and_C0nfused said:

Interest from an ISA is not taxable income and wouldn't need to be included on a tax return.

If you have taxable interest of £9,000 from banks and building societies and interest from a cash ISA of £1,500 then that isn't a reason to file a tax return.

yes what you say is true - I know that, you know that, everybody else knows that - but the HMRC website says the opposite!

eskbanker

Olinda99 said:

Dazed_and_C0nfused said:

Interest from an ISA is not taxable income and wouldn't need to be included on a tax return.

If you have taxable interest of £9,000 from banks and building societies and interest from a cash ISA of £1,500 then that isn't a reason to file a tax return.

yes what you say is true - I know that, you know that, everybody else knows that - but the HMRC website says the opposite!

The site could be clearer - it highlights that ISA interest is excluded from those items needed to be measured against the personal savings allowance but doesn't explicitly clarify that it's the same items that need to be measured against the £10K SA limit, so adding something like 'qualifying' would be better in the latter, even though it's in the section about exceeding the allowance:

Interest covered by your allowance

Your allowance applies to interest from:

• bank and building society accounts
• savings and credit union accounts
• unit trusts, investment trusts and open-ended investment companies
• peer-to-peer lending
• trust funds
• payment protection insurance (PPI)
• government or company bonds
• life annuity payments
• some life insurance contracts

Savings in tax-free accounts like Individual Savings Accounts (ISAs) and some National Savings and Investments accounts do not count towards your allowance.

There are different rules for tax on foreign savings and children’s accounts.

Interest on joint accounts

If you have a joint account, interest will be split equally between the account holders. Contact the savings helpline if you think it should be split differently.

If you go over your allowance

You pay tax on any interest over your allowance at your usual rate of Income Tax.

If you’re employed or get a pension, HMRC will change your tax code so you pay the tax automatically. To decide your tax code, HMRC will estimate how much interest you’ll get in the current year by looking at how much you got the previous year.

If you complete a Self Assessment tax return, report any interest earned on savings there.

You need to register for Self Assessment if your income from savings and investments is over £10,000. Check if you need to send a tax return if you’re not sure.

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