Tax on savings interest, how does it work? Is there any efficiencies I can do?

Doctor_Who

boingy said:

Ironically, it took 8 years after I went back into PAYE for them to agree that I no longer needed to SA (I'd been self-employed for 12 years).

HMRC put me on SA for 10 years when I asked them how I could reclaim higher rate tax relief on pension contributions. I was still a HR tax payer making pension contributions when they removed me from SA in 2018!

Albermarle

boingy said:

Ironically, it took 8 years after I went back into PAYE for them to agree that I no longer needed to SA (I'd been self-employed for 12 years).

From the opposite angle, I was taken off SA unwillingly as part of some drive to reduce the number of SA. It seemed to be OK using the personal tax account, until I finished work and was due a significant rebate which never arrived. After  calls with HMRC it turned out somewhere in their system there was still a link to SA, so the usual automatic PAYE P800 calculation could not happen. Got sorted eventually.

Dazed_and_C0nfused

Nebulous2 said:

isasmurf said:

djbreeze said:

Morning all,

I've just logged in to the forum to ask exactly the same thing, first time this year will be just over the £1k interest. I have little trust in the inland revenue getting it right & I believe it's nigh on impossible to contact them so any advice on how to pay as a bill rather than have tax code amended would be really appreciated. What's the October letter that's mentioned above?

Thanks, David.

Over the summer/autumn HMRC will calculate your tax liability for the previous tax year from all their data sources and reconcile it with your tax paid. If you have under or over paid tax they will send you a tax calculation showing a summary of the amount and the calculation. It should detail how an underpayment will be collected or an overpayment repaid. 

That was timely - thank you. I logged in from curiosity, was told I had overpaid by £18 according to the letter they had sent me. I haven't received it, so it must be en-route. 

I was then able to ask them to make the refund direct to my bank account. 

You wouldn't have been able to do that it it was en-route.

If that was happening people would be getting double tax refunds on a regular basis 😳

Nebulous2

Dazed_and_C0nfused said:

Nebulous2 said:

isasmurf said:

djbreeze said:

Morning all,

I've just logged in to the forum to ask exactly the same thing, first time this year will be just over the £1k interest. I have little trust in the inland revenue getting it right & I believe it's nigh on impossible to contact them so any advice on how to pay as a bill rather than have tax code amended would be really appreciated. What's the October letter that's mentioned above?

Thanks, David.

Over the summer/autumn HMRC will calculate your tax liability for the previous tax year from all their data sources and reconcile it with your tax paid. If you have under or over paid tax they will send you a tax calculation showing a summary of the amount and the calculation. It should detail how an underpayment will be collected or an overpayment repaid. 

That was timely - thank you. I logged in from curiosity, was told I had overpaid by £18 according to the letter they had sent me. I haven't received it, so it must be en-route. 

I was then able to ask them to make the refund direct to my bank account. 

You wouldn't have been able to do that it it was en-route.

If that was happening people would be getting double tax refunds on a regular basis 😳

I meant the letter was en-route, not the refund.

In fact I've just arrived home and it came in the post today! 

Dazed_and_C0nfused

Nebulous2 said:

Dazed_and_C0nfused said:

Nebulous2 said:

isasmurf said:

djbreeze said:

Morning all,

I've just logged in to the forum to ask exactly the same thing, first time this year will be just over the £1k interest. I have little trust in the inland revenue getting it right & I believe it's nigh on impossible to contact them so any advice on how to pay as a bill rather than have tax code amended would be really appreciated. What's the October letter that's mentioned above?

Thanks, David.

Over the summer/autumn HMRC will calculate your tax liability for the previous tax year from all their data sources and reconcile it with your tax paid. If you have under or over paid tax they will send you a tax calculation showing a summary of the amount and the calculation. It should detail how an underpayment will be collected or an overpayment repaid. 

That was timely - thank you. I logged in from curiosity, was told I had overpaid by £18 according to the letter they had sent me. I haven't received it, so it must be en-route. 

I was then able to ask them to make the refund direct to my bank account. 

You wouldn't have been able to do that it it was en-route.

If that was happening people would be getting double tax refunds on a regular basis 😳

I meant the letter was en-route, not the refund.

In fact I've just arrived home and it came in the post today! 

Makes sense now!

aroominyork

Albermarle said:

Yjaypers said:

I had to do a self assessment for the first time in ages last tax year. To be honest, I now prefer to do a SA as I know that things like interest tax is 100% correct. I also opt to pay it as a bill rather than in my tax code.

So far as efficiencies, as above really. If you have a spouse, utilise their allowance as much as you can too. Pension, ISA etc also worth looking at. 

Just for others to be aware, you can not just choose to do SA. In fact HMRC are trying to reduce the number of people doing SA.
Check if you need to send a Self Assessment tax return - GOV.UK (www.gov.uk)

Curiously, the questionnaire says "You usually have to pay Capital Gains Tax when you sell or give away...most personal possessions worth £6,000 or more". Surely that's wrong - it's the capital gain and not the value which must exceed £6,000.

MDMD

aroominyork said:

Albermarle said:

Yjaypers said:

I had to do a self assessment for the first time in ages last tax year. To be honest, I now prefer to do a SA as I know that things like interest tax is 100% correct. I also opt to pay it as a bill rather than in my tax code.

So far as efficiencies, as above really. If you have a spouse, utilise their allowance as much as you can too. Pension, ISA etc also worth looking at. 

Just for others to be aware, you can not just choose to do SA. In fact HMRC are trying to reduce the number of people doing SA.
Check if you need to send a Self Assessment tax return - GOV.UK (www.gov.uk)

Curiously, the questionnaire says "You usually have to pay Capital Gains Tax when you sell or give away...most personal possessions worth £6,000 or more". Surely that's wrong - it's the capital gain and not the value which must exceed £6,000.

That’s referring to the chattels rule, it’s just coincidence that it’s now the same as the Annual Exempt Amount 

https://www.gov.uk/government/publications/chattels-and-capital-gains-tax-hs293-self-assessment-helpsheet/chattels-and-capital-gains-tax-2021-hs293