Tax Code changed due to Personal Savings Allowance

the_goon

Hi all
I've had notification this morning that my tax code is changing due to "Untaxed interest on savings and investments". I made an error and went over my personal savings allowance but about £150 for last year. However, as I understand it, they'll now assume this will happen every year going forward. It won't, as I've moved cash into tax free areas.
How do I get the tax code to change back?
I can't see anywhere on the GOV.uk PAYE part of the website where I can contact someone.
Cheers.

Dazed_and_C0nfused

the_goon said:

Hi all
I've had notification this morning that my tax code is changing due to "Untaxed interest on savings and investments". I made an error and went over my personal savings allowance but about £150 for last year. However, as I understand it, they'll now assume this will happen every year going forward. It won't, as I've moved cash into tax free areas.
How do I get the tax code to change back?
I can't see anywhere on the GOV.uk PAYE part of the website where I can contact someone.
Cheers.

You can provide an update on your Personal Tax Account, look for an oddly named link called Add investment income or something like that.

And it won't be "every year going forward".  It will be this year and next and then next summer/autumn when they get the actual info for 2025/26 they will review your (26/27) tax code and refund any tax overpaid in 25/26.

But you are perfectly entitled to provide an update if you are happy to, I think you need to provide figures for each individual bank account for HMRC to update things correctly.

Saver73

There is also the option of paying the amount due if you don't want your tax code amended.

the_goon

Saver73 said:

There is also the option of paying the amount due if you don't want your tax code amended.

How do you go about doing this?
Thanks

Saver73

Within your personal tax account where it shows you the calculation of the underpayment it will give you the options.  

(I did mine online but I think you could do it via app too) 

born_again

Saver73 said:

There is also the option of paying the amount due if you don't want your tax code amended.

Look at it this way. They are in effect giving you a interest free loan to pay it back over a year. You can reinvest the amount & make more out of it, while paying them back.
Pay it now & you will lose out.

the_goon

So, ultimately, if I leave it and do nothing, my tax code will revert back once they see I'm not going over the Personal Savings Allowance of £1000 any more, and they'll refund any overpayment?

Saver73

@born_again thank you - I think it's up to individuals to choose which option they prefer, but as this option isn't that widely known, in my opinion, that is why I mention it.

My underpayment was for a small sum (to me) so I chose to pay it because reinvesting it in savings wouldn't gain me that much savings interest  in a year and I'm not interested in investing in any other sense, except my pension.

I don't feel I have lost out, I have got exactly what I wanted.

molerat

the_goon said:

So, ultimately, if I leave it and do nothing, my tax code will revert back once they see I'm not going over the Personal Savings Allowance of £1000 any more, and they'll refund any overpayment?

Not until your savings interest for this year has been reported which is around October next year.  If you definitely think you will not be over your allowance this year or think the amount will be different to what they have predicted best you change it.

Saver73

the_goon said:

So, ultimately, if I leave it and do nothing, my tax code will revert back once they see I'm not going over the Personal Savings Allowance of £1000 any more, and they'll refund any overpayment?

When I read your original post, I read it that you were referring to the tax year 24/25 when you said 'last year' so if you do nothing then your tax code will be amended to recoup the underpayment.

Worth having a look at your personal tax account to check.

As per @molerat other post it's worth checking your tax code around Oct/Nov time.  I check mine in Jan/Feb too to make sure I'm not on a M1 or X code prior to March payroll.