Darlington BS massively overpays annual interest

friolento

I am not concerned enough myself but if anyone is worried that Darlington might report incorrect interest amounts to HMRC, or is generally unhappy how they handled the correction / the issue as such, why not write to Darlington about it? Don’t bury them with complaints though, this is not a massive issue, and definitely not an opportunity for demanding compensation 

clairec666

friolento said:

I am not concerned enough myself but if anyone is worried that Darlington might report incorrect interest amounts to HMRC, or is generally unhappy how they handled the correction / the issue as such, why not write to Darlington about it? Don’t bury them with complaints though, this is not a massive issue, and definitely not an opportunity for demanding compensation 

I'm giving them the benefit of the doubt and assuming that they've sorted things properly. I feel they could have handled it better (i.e. emailing all affected customers to let them know what was happening) but I don't think it's worth a formal complaint.
It's nowhere near as bad as Zopa mis-reporting ISA interest as taxable, which has caused people a lot of hassle to sort out, then making the same mistake all over again.

masonic

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.

For context, I have been on self-assessment for around a decade and my figures would never have matched HMRC's, due to flaws in how multi-year fixed term account interest is reported in the BBSI returns. In some years the discrepancy will be several hundred pounds, all of it over the PSA. This has never been queried.

Being on SA actually puts you in the best possible position for this situation. You won't even need to check what is reported, unlike those who rely on HMRC's calculation.

I don't like the use of ‘Cap Bal Cor’ either, but I'd be surprised if they haven't taken steps to ensure the interest reported is also adjusted.

Kim_13

friolento said:

I am not concerned enough myself but if anyone is worried that Darlington might report incorrect interest amounts to HMRC, or is generally unhappy how they handled the correction / the issue as such, why not write to Darlington about it? Don’t bury them with complaints though, this is not a massive issue, and definitely not an opportunity for demanding compensation 

The time to be looking for compensation would be when and if it is discovered they have actually reported incorrectly. I won’t be complaining, thankfully the error in my case was only £30 so I still wouldn’t be paying tax on it. 

I have had my rant here (which may prompt others to check that the reporting is correct) and that’s enough for me.

clairec666

masonic 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.

For context, I have been on self-assessment for around a decade and my figures would never have matched HMRC's, due to flaws in how multi-year fixed term account interest is reported in the BBSI returns. In some years the discrepancy will be several hundred pounds, all of it over the PSA. This has never been queried.

Being on SA actually puts you in the best possible position for this situation. You won't even need to check what is reported, unlike those who rely on HMRC's calculation.

I don't like the use of ‘Cap Bal Cor’ either, but I'd be surprised if they haven't taken steps to ensure the interest reported is also adjusted.

Thanks. I'm only on my second year of self assessment so am keen to get it right. It's reassuring to know that you've never been chased over any discrepancies. I'm confident that my own record-keeping and calculations are correct, despite having a larger than average number of accounts to tot up. So probably no need to worry.

Hattie627

masonic 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.

For context, I have been on self-assessment for around a decade and my figures would never have matched HMRC's, due to flaws in how multi-year fixed term account interest is reported in the BBSI returns. In some years the discrepancy will be several hundred pounds, all of it over the PSA. This has never been queried.

Being on SA actually puts you in the best possible position for this situation. You won't even need to check what is reported, unlike those who rely on HMRC's calculation.

I don't like the use of ‘Cap Bal Cor’ either, but I'd be surprised if they haven't taken steps to ensure the interest reported is also adjusted.

I agree. I like being on self-assessment. It puts the tax payer in the driving seat of what income is reported and the final tax bill is calculated on what is reported by the taxpayer. Like others upthread, I keep meticulous records of interest paid and I have confidence that the untaxed interest figure which I report each year under SA is accurate.  If HMRC wish to raise an issue with my reported figures they can do so, but this has never happened since I started on SA in the early 2000's. I am sure that they have bigger fish to fry. I wouldn't like to be reliant on HMRC adjusting my code to recover the tax due on untaxed interest without me seeing the full details (institutions, dates, amounts paid) of the untaxed interest which they are basing this on and comparing it with my own figures. I'm sure that I could do this, but it would involve contacting HMRC for the information needed and would involve more hassle than simple doing the SA return online.