Darlington BS massively overpays annual interest

SnowMan

£1,250 x 0.06 = £75 (or (1250 + 75) x 0.06/365 + 75 = 75.22)

So confirming that their mistake was to calculate interest to 31st December 2026 (or 1st January 2027 to be precise as they've removed 366 days of interest applied to the balance at 31st December 2025) instead of 31st December 2025. 

Think they will be a bit more careful next time with getting the year right on their year end dates.

jaypers

I would rather have seen a reversal of the whole amount and the correct amount credited…….presumably they know what they are doing and the correct amount will be declared to HMRC.

Hattie627

jaypers said:

I would rather have seen a reversal of the whole amount and the correct amount credited…….presumably they know what they are doing and the correct amount will be declared to HMRC.

I agree. If they report the original amount to HMRC followed by the "reduction" as a second report, HMRC computers are bound to screw it up and add the two figures together. Can almost predict that it will go wrong.

Pickledonionlover

Similar story regarding the partial reversal here

Kim_13

Hattie627 said:

jaypers said:

I would rather have seen a reversal of the whole amount and the correct amount credited…….presumably they know what they are doing and the correct amount will be declared to HMRC.

I agree. If they report the original amount to HMRC followed by the "reduction" as a second report, HMRC computers are bound to screw it up and add the two figures together. Can almost predict that it will go wrong.

Yes, it’s difficult to conclude anything other than that ‘Cap Bal Cor’ is a Capital Balance Correction and that their resolution effectively allowed savers to keep the overpaid interest while helping themselves to part of the capital to recover the amount they were owed. If this turns out to be the case then it is only a resolution for those who will a) not pay tax on their savings either way and b) not be pushed into a higher tax band as a result of the overpaid interest being reported to HMRC. Anyone else would still end up being taxed on an amount of ‘interest’ that was not income from savings but in fact part of the amount they originally deposited.

We should never have seen anything other than one of an interest correction ‘Int Cor?’ or the correct interest credit and a reversal of the wrong one. While I agree we needed to give them time to resolve it, two weeks to do something that at best causes concern due to poor labelling and at worst creates an incorrect tax liability can’t be described as anything other than abysmal.

clairec666

Kim_13 said:

Hattie627 said:

jaypers said:

I would rather have seen a reversal of the whole amount and the correct amount credited…….presumably they know what they are doing and the correct amount will be declared to HMRC.

I agree. If they report the original amount to HMRC followed by the "reduction" as a second report, HMRC computers are bound to screw it up and add the two figures together. Can almost predict that it will go wrong.

Yes, it’s difficult to conclude anything other than that ‘Cap Bal Cor’ is a Capital Balance Correction and that their resolution effectively allowed savers to keep the overpaid interest while helping themselves to part of the capital to recover the amount they were owed. If this turns out to be the case then it is only a resolution for those who will a) not pay tax on their savings either way and b) not be pushed into a higher tax band as a result of the overpaid interest being reported to HMRC. Anyone else would still end up being taxed on an amount of ‘interest’ that was not income from savings but in fact part of the amount they originally deposited.

We should never have seen anything other than one of an interest correction ‘Int Cor?’ or the correct interest credit and a reversal of the wrong one. While I agree we needed to give them time to resolve it, two weeks to do something that at best causes concern due to poor labelling and at worst creates an incorrect tax liability can’t be described as anything other than abysmal.

I've been defending Darlington up until now, and am okay with them taking a couple of weeks to resolve things... provided that they resolve things properly. It's worth them taking their time now rather than having to resolve complaints further down the line.

I am one of the people most likely to be affected. I am a basic rate taxpayer who earns more than £1000 in interest. I also do self assessment. A cursory glance at other threads on this for suggests that ensuring your interest calculations tally with HMRC is not straightforward. I keep meticulous records so will submit my calculations in my next SA, cross my fingers and hope for the best. If Darlington haven't reported the correct amount, it might take a fair amount of untangling.

Dazed_and_C0nfused

clairec666 said:

Kim_13 said:

Hattie627 said:

jaypers said:

I would rather have seen a reversal of the whole amount and the correct amount credited…….presumably they know what they are doing and the correct amount will be declared to HMRC.

I agree. If they report the original amount to HMRC followed by the "reduction" as a second report, HMRC computers are bound to screw it up and add the two figures together. Can almost predict that it will go wrong.

Yes, it’s difficult to conclude anything other than that ‘Cap Bal Cor’ is a Capital Balance Correction and that their resolution effectively allowed savers to keep the overpaid interest while helping themselves to part of the capital to recover the amount they were owed. If this turns out to be the case then it is only a resolution for those who will a) not pay tax on their savings either way and b) not be pushed into a higher tax band as a result of the overpaid interest being reported to HMRC. Anyone else would still end up being taxed on an amount of ‘interest’ that was not income from savings but in fact part of the amount they originally deposited.

We should never have seen anything other than one of an interest correction ‘Int Cor?’ or the correct interest credit and a reversal of the wrong one. While I agree we needed to give them time to resolve it, two weeks to do something that at best causes concern due to poor labelling and at worst creates an incorrect tax liability can’t be described as anything other than abysmal.

I've been defending Darlington up until now, and am okay with them taking a couple of weeks to resolve things... provided that they resolve things properly. It's worth them taking their time now rather than having to resolve complaints further down the line.

I am one of the people most likely to be affected. I am a basic rate taxpayer who earns more than £1000 in interest. I also do self assessment. A cursory glance at other threads on this for suggests that ensuring your interest calculations tally with HMRC is not straightforward. I keep meticulous records so will submit my calculations in my next SA, cross my fingers and hope for the best. If Darlington haven't reported the correct amount, it might take a fair amount of untangling.

You don't need to ensure your interest calculations tally with HMRC.  You just need to complete your tax return accurately.

The onus is then on HMRC to open an enquiry into your return if they think anything is wrong.

clairec666

Dazed_and_C0nfused said:

clairec666 said:

Kim_13 said:

Hattie627 said:

jaypers said:

I would rather have seen a reversal of the whole amount and the correct amount credited…….presumably they know what they are doing and the correct amount will be declared to HMRC.

I agree. If they report the original amount to HMRC followed by the "reduction" as a second report, HMRC computers are bound to screw it up and add the two figures together. Can almost predict that it will go wrong.

Yes, it’s difficult to conclude anything other than that ‘Cap Bal Cor’ is a Capital Balance Correction and that their resolution effectively allowed savers to keep the overpaid interest while helping themselves to part of the capital to recover the amount they were owed. If this turns out to be the case then it is only a resolution for those who will a) not pay tax on their savings either way and b) not be pushed into a higher tax band as a result of the overpaid interest being reported to HMRC. Anyone else would still end up being taxed on an amount of ‘interest’ that was not income from savings but in fact part of the amount they originally deposited.

We should never have seen anything other than one of an interest correction ‘Int Cor?’ or the correct interest credit and a reversal of the wrong one. While I agree we needed to give them time to resolve it, two weeks to do something that at best causes concern due to poor labelling and at worst creates an incorrect tax liability can’t be described as anything other than abysmal.

I've been defending Darlington up until now, and am okay with them taking a couple of weeks to resolve things... provided that they resolve things properly. It's worth them taking their time now rather than having to resolve complaints further down the line.

I am one of the people most likely to be affected. I am a basic rate taxpayer who earns more than £1000 in interest. I also do self assessment. A cursory glance at other threads on this for suggests that ensuring your interest calculations tally with HMRC is not straightforward. I keep meticulous records so will submit my calculations in my next SA, cross my fingers and hope for the best. If Darlington haven't reported the correct amount, it might take a fair amount of untangling.

You don't need to ensure your interest calculations tally with HMRC.  You just need to complete your tax return accurately.

The onus is then on HMRC to open an enquiry into your return if they think anything is wrong.

Yes, but it would still mean extra hassle for me if they disagree with my figures.

gt94sss2

clairec666 said:

Dazed_and_C0nfused said:

clairec666 said:

Kim_13 said:

Hattie627 said:

jaypers said:

I would rather have seen a reversal of the whole amount and the correct amount credited…….presumably they know what they are doing and the correct amount will be declared to HMRC.

I agree. If they report the original amount to HMRC followed by the "reduction" as a second report, HMRC computers are bound to screw it up and add the two figures together. Can almost predict that it will go wrong.

Yes, it’s difficult to conclude anything other than that ‘Cap Bal Cor’ is a Capital Balance Correction and that their resolution effectively allowed savers to keep the overpaid interest while helping themselves to part of the capital to recover the amount they were owed. If this turns out to be the case then it is only a resolution for those who will a) not pay tax on their savings either way and b) not be pushed into a higher tax band as a result of the overpaid interest being reported to HMRC. Anyone else would still end up being taxed on an amount of ‘interest’ that was not income from savings but in fact part of the amount they originally deposited.

We should never have seen anything other than one of an interest correction ‘Int Cor?’ or the correct interest credit and a reversal of the wrong one. While I agree we needed to give them time to resolve it, two weeks to do something that at best causes concern due to poor labelling and at worst creates an incorrect tax liability can’t be described as anything other than abysmal.

I've been defending Darlington up until now, and am okay with them taking a couple of weeks to resolve things... provided that they resolve things properly. It's worth them taking their time now rather than having to resolve complaints further down the line.

I am one of the people most likely to be affected. I am a basic rate taxpayer who earns more than £1000 in interest. I also do self assessment. A cursory glance at other threads on this for suggests that ensuring your interest calculations tally with HMRC is not straightforward. I keep meticulous records so will submit my calculations in my next SA, cross my fingers and hope for the best. If Darlington haven't reported the correct amount, it might take a fair amount of untangling.

You don't need to ensure your interest calculations tally with HMRC.  You just need to complete your tax return accurately.

The onus is then on HMRC to open an enquiry into your return if they think anything is wrong.

Yes, but it would still mean extra hassle for me if they disagree with my figures.

As you do self assessment, HMRC are extremely unlikely to question your interest figures even if they disagree with their own records.

However, I think we are all blowing this out of all proportion - Darlington only submit an interest rate return once a year and they obviously know about this issue and there is no reason to think that their return will be incorrect.

It doesn't matter how Darlington have described the interest correction transaction.

ForumUser7

gt94sss2 said:

clairec666 said:

Dazed_and_C0nfused said:

clairec666 said:

Kim_13 said:

Hattie627 said:

jaypers said:

I would rather have seen a reversal of the whole amount and the correct amount credited…….presumably they know what they are doing and the correct amount will be declared to HMRC.

I agree. If they report the original amount to HMRC followed by the "reduction" as a second report, HMRC computers are bound to screw it up and add the two figures together. Can almost predict that it will go wrong.

Yes, it’s difficult to conclude anything other than that ‘Cap Bal Cor’ is a Capital Balance Correction and that their resolution effectively allowed savers to keep the overpaid interest while helping themselves to part of the capital to recover the amount they were owed. If this turns out to be the case then it is only a resolution for those who will a) not pay tax on their savings either way and b) not be pushed into a higher tax band as a result of the overpaid interest being reported to HMRC. Anyone else would still end up being taxed on an amount of ‘interest’ that was not income from savings but in fact part of the amount they originally deposited.

We should never have seen anything other than one of an interest correction ‘Int Cor?’ or the correct interest credit and a reversal of the wrong one. While I agree we needed to give them time to resolve it, two weeks to do something that at best causes concern due to poor labelling and at worst creates an incorrect tax liability can’t be described as anything other than abysmal.

I've been defending Darlington up until now, and am okay with them taking a couple of weeks to resolve things... provided that they resolve things properly. It's worth them taking their time now rather than having to resolve complaints further down the line.

I am one of the people most likely to be affected. I am a basic rate taxpayer who earns more than £1000 in interest. I also do self assessment. A cursory glance at other threads on this for suggests that ensuring your interest calculations tally with HMRC is not straightforward. I keep meticulous records so will submit my calculations in my next SA, cross my fingers and hope for the best. If Darlington haven't reported the correct amount, it might take a fair amount of untangling.

You don't need to ensure your interest calculations tally with HMRC.  You just need to complete your tax return accurately.

The onus is then on HMRC to open an enquiry into your return if they think anything is wrong.

Yes, but it would still mean extra hassle for me if they disagree with my figures.

As you do self assessment, HMRC are extremely unlikely to question your interest figures even if they disagree with their own records.

However, I think we are all blowing this out of all proportion - Darlington only submit an interest rate return once a year and they obviously know about this issue and there is no reason to think that their return will be incorrect.

It doesn't matter how Darlington have described the interest correction transaction.

One would hope they write to affected customers at some point to explain it though - they seem to be kind of sweeping it under the rug by only having a message on their website.