How to update HMRC estimate for tax on savings

Fatferds12

Hello - My latest tax code for 24/25 shows too little tax due for interest on savings. 
If I update this through the Income Investment link on my HMRC account will this automatically update my tax code? 
Also the interest on savings amount for next year 26//27 is far too high so should I put in what I think it will be and then adjust it towards the end of the year?
There is also an amount for next year as an Underpayment so again if I update it with the correct figures will this also change? 

I've never had tax on interest taken automatically before so it's all a bit new to me.

Many thanks.

Ayr_Rage

26/27 won't be there yet !

Suggest you go back and check your online account.

Fatferds12

Ayr_Rage said:

26/27 won't be there yet !

Suggest you go back and check your online account.

Hi Ayr Rage - see that just shows what a spin my head is in and you are of course right!  

maman

I'm in a similar but reverse position to @Ayr_Rage. I was taxed on last year's savings and chose to pay what I owed in a lump sum.

Despite this, my tax code for the current year has been changed to assume I'll still have these savings. I know I won't have the same interest this year as a large part of the savings has been used for planned building work. 

Is there anything I can do other than wait for a refund in a year or so's time? 🤔

Fatferds12

maman said:

I'm in a similar but reverse position to @Ayr_Rage. I was taxed on last year's savings and chose to pay what I owed in a lump sum.

Despite this, my tax code for the current year has been changed to assume I'll still have these savings. I know I won't have the same interest this year as a large part of the savings has been used for planned building work. 

Is there anything I can do other than wait for a refund in a year or so's time? 🤔

I know it's no help to you but that's exactly what happened to me!  Paid a lump sum last year and now it's been estimated incorrectly for next year and same asI won't be earning nearly as much next year.  Hopefully someone will know what to do.

Dazed_and_C0nfused

Fatferds12 said:

maman said:

I'm in a similar but reverse position to @Ayr_Rage. I was taxed on last year's savings and chose to pay what I owed in a lump sum.

Despite this, my tax code for the current year has been changed to assume I'll still have these savings. I know I won't have the same interest this year as a large part of the savings has been used for planned building work. 

Is there anything I can do other than wait for a refund in a year or so's time? 🤔

I know it's no help to you but that's exactly what happened to me!  Paid a lump sum last year and now it's been estimated incorrectly for next year and same asI won't be earning nearly as much next year.  Hopefully someone will know what to do.

You need log into your Personal Tax Account and use the (badly named) link called Add missing investment income

That actually gives you three different options (again a little oddly worded).  I would guess 1) is what most people will need.

What do you want to tell us about your untaxed interest?

1) The income amount in my personal tax account does not match the amount I received

2) The investment is missing from my Personal Tax Account

3) The investment income has ended

Fatferds12

Dazed_and_C0nfused said:

Fatferds12 said:

maman said:

I'm in a similar but reverse position to @Ayr_Rage. I was taxed on last year's savings and chose to pay what I owed in a lump sum.

Despite this, my tax code for the current year has been changed to assume I'll still have these savings. I know I won't have the same interest this year as a large part of the savings has been used for planned building work. 

Is there anything I can do other than wait for a refund in a year or so's time? 🤔

I know it's no help to you but that's exactly what happened to me!  Paid a lump sum last year and now it's been estimated incorrectly for next year and same asI won't be earning nearly as much next year.  Hopefully someone will know what to do.

You need log into your Personal Tax Account and use the (badly named) link called Add missing investment income

That actually gives you three different options (again a little oddly worded).  I would guess 1) is what most people will need.

What do you want to tell us about your untaxed interest?

1) The income amount in my personal tax account does not match the amount I received

2) The investment is missing from my Personal Tax Account

3) The investment income has ended

Thanks for this and I can see this option so I'll fill it in and hopefully it will update it to the correct amount  I know it will mean paying more tax but I'd rather know it's correct.  Thanks again for your help.

Fatferds12

Dazed_and_C0nfused said:

Fatferds12 said:

maman said:

I'm in a similar but reverse position to @Ayr_Rage. I was taxed on last year's savings and chose to pay what I owed in a lump sum.

Despite this, my tax code for the current year has been changed to assume I'll still have these savings. I know I won't have the same interest this year as a large part of the savings has been used for planned building work. 

Is there anything I can do other than wait for a refund in a year or so's time? 🤔

I know it's no help to you but that's exactly what happened to me!  Paid a lump sum last year and now it's been estimated incorrectly for next year and same asI won't be earning nearly as much next year.  Hopefully someone will know what to do.

You need log into your Personal Tax Account and use the (badly named) link called Add missing investment income

That actually gives you three different options (again a little oddly worded).  I would guess 1) is what most people will need.

What do you want to tell us about your untaxed interest?

1) The income amount in my personal tax account does not match the amount I received

2) The investment is missing from my Personal Tax Account

3) The investment income has ended

I'm probably overthinking this as I was about to put the amount in for this year's interest and then thought what happens if/when the bank that hasn't told them my interest figures decides to.  Will HMRC still go on my figure or will they then add on the amount from the bank that's been late?  I just wish I had a head for tax 'n' figures..............

maman

I'm probably missing something but the option on the link only allows for 'lnvestment income has ended'. Mine hasn't ended, just greatly reduced. I expect to pay some tax but not anything like as much as last year. I can't really estimate how much as I'm hoping to add to my savings in the coming year.

I'd hoped that by paying it off (immediately I was advised of the figures) then my tax code would stay the same and next year I could pay again whatever was owed.

That's probably too simplistic for HMRC. 🤔

eskbanker

Fatferds12 said:

I'm probably overthinking this as I was about to put the amount in for this year's interest and then thought what happens if/when the bank that hasn't told them my interest figures decides to.  Will HMRC still go on my figure or will they then add on the amount from the bank that's been late?  I just wish I had a head for tax 'n' figures..............

Yes, you're overthinking this!

Any figures you supply in good faith via this mechanism are simply used to adjust your PAYE tax code, and aren't intended to be a binding declaration of actual amounts, which often won't be known anyway during the tax year.  When the time comes for HMRC to determine your actual tax liability later in the (calendar) year, they'll use the actual figures supplied (annually) by the banks and ignore what you'd specified via the mechanism discussed above.

Albermarle

maman said:

I'm probably missing something but the option on the link only allows for 'lnvestment income has ended'. Mine hasn't ended, just greatly reduced. I expect to pay some tax but not anything like as much as last year. I can't really estimate how much as I'm hoping to add to my savings in the coming year.

I'd hoped that by paying it off (immediately I was advised of the figures) then my tax code would stay the same and next year I could pay again whatever was owed.

That's probably too simplistic for HMRC. 🤔

HMRC have to have a system as they have millions of accounts to deal with. So their default position in these type of matters, is to predict you will get the same interest next year until informed otherwise. I am not sure they can do it any other way without causing more problems.