How to report excess earnings for last year

evgeniypd95

Hey guys, 

I just calculated my earnings from interest and it seems that I have exceeded my 500 pound allowance last year. 

How should I report the excess for last tax year to HMRC? I do they somehow know this by magic and will adjust my tax accordingly? In my personal account on HMRC there is just no button to report extra income for a previous tax year. 

Thanks!!!!

Dazed_and_C0nfused

evgeniypd95 said:

Hey guys, 

I just calculated my earnings from interest and it seems that I have exceeded my 500 pound allowance last year. 

How should I report the excess for last tax year to HMRC? I do they somehow know this by magic and will adjust my tax accordingly? In my personal account on HMRC there is just no button to report extra income for a previous tax year. 

Thanks!!!!

Assuming this interest is from a bank or building society then yes, they will know about it as the banks/building societies have to report it to HMRC.

You should get a calculation later this summer showing any tax owed for 2023-24.

This will normally be collected by making an adjustment to your 2025-26 tax code, starting next April.

They will also assume/estimate that you will receive the same interest again in the current tax year and update your 2024-25 tax code to reflect this, again later this summer.

The same thing happens next summer for 2024-25 and you will get a refund if you paid too much tax for 2024-25 (or a underpayment calculation again if you owe more).

flaneurs_lobster

It's all covered here

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

but basically the interest-paying institutions report your interest earnings to HMRC around now-ish and they will adjust your PAYE coding to collect tax due during the next financial year. HMRC will contact you with their calculations later this year and you can, if you wish, pay tax owing as a lump sum.