Untaxed interest on savings affecting my tax code

greenery

I submitted a tax self assessment last year and included a tiny amount of interest from uk banks ( less that £100)
I had a tax code of 1131 ( personal allowance plus transferred marriage allowance)
I have just started to receive a small pension and got a message from HMRC to say my tax code has changed to 1129. This is now including a Untaxed interest on savings & investments amount of £15
I will ring HMRC next week to find out where it has come from, but wondered if anyone has any ideas

eskbanker

HMRC assumes that the savings interest you earned in the last tax year will continue - it's not particularly intuitive how (or even why) they adjust your PAYE tax coding as a consequence of that but is the way their system is set up.

Is your non-savings income actually likely to exceed £11,290?

zagfles

It's the utterly pointless way HMRC do things. Discussed here a lot.

Bottom line is that if you're sure your taxable income will be below 11290 then don't worry about it, you won't pay any tax. If it might be above 11290 then you can login to your tax account and give them an estimate - use the highest it might be. Then they should remove it. 

I presume your tax code hasn't been changed to a X, M1 or W1 at the end, if it has you'll probably need to phone them. 

greenery

zagfles said:

It's the utterly pointless way HMRC do things. Discussed here a lot.

Bottom line is that if you're sure your taxable income will be below 11290 then don't worry about it, you won't pay any tax. If it might be above 11290 then you can login to your tax account and give them an estimate - use the highest it might be. Then they should remove it. 

I presume your tax code hasn't been changed to a X, M1 or W1 at the end, if it has you'll probably need to phone them. 

Thanks. I phoned them and it still makes no sense. They said it was just a note on file but I didn't get a real answer.
I think my income will be marginal below 11290 (within a few £) so I should be OK but next year it will be higher and so will my interest on savings, so I guess I will have to revisit next year.

The tax code did have an X, but they have removed it after I phoned 

zagfles

greenery said:

zagfles said:

It's the utterly pointless way HMRC do things. Discussed here a lot.

Bottom line is that if you're sure your taxable income will be below 11290 then don't worry about it, you won't pay any tax. If it might be above 11290 then you can login to your tax account and give them an estimate - use the highest it might be. Then they should remove it. 

I presume your tax code hasn't been changed to a X, M1 or W1 at the end, if it has you'll probably need to phone them. 

Thanks. I phoned them and it still makes no sense. They said it was just a note on file but I didn't get a real answer.
I think my income will be marginal below 11290 (within a few £) so I should be OK but next year it will be higher and so will my interest on savings, so I guess I will have to revisit next year.

The tax code did have an X, but they have removed it after I phoned 

At the start of next tax year you can login to your tax account and give an estimate of your income, estimate the max it's likely to be, and you should be OK.