Panic! - Help with Registering for Self Assessment

Shylock_249

I knew it had to happen! My wife has just been sent a letter from HMRC telling her to register for Self Assessment.

The reason is she received over 12k in untaxed interest for this FY 25/26.

I do it for her because of medical reasons.

I've logged in using the Government Gateway and started the form, I've got to assume that the choice that is most applicable is "I've untaxed income which cannot be coded in PAYE"?

There is NO choice for I'm doing it because you told me to do it!

I don't know what "coded in PAYE" means

If I exit the form without completing it fully is it saved or if I log back in I'll have to complete it all again.

Strange that both myself and wife received the same amount of interest in this FY and I contacted HMRC through Gov Gateway and advised them that that their estimated figure of 14k was incorrect and it was 12k. Mine was accepted and the figures changed but the wife was asked to give bank details for the interest, as at yesterday on PAYE it still showed 14k and today she's received the notification to register for self assessment.

It doesn't help that they still haven't finalised her 24/25 account.

Please is: "I've untaxed income which cannot be coded in PAYE" the correct choice?

DRS1

It sounds like a good choice though I have no idea what the other choices are.

Interest is untaxed income and if she does not get salary or pension which has a tax code attached to it then it cannot be coded in PAYE.

FrugaiMacDugal

How does HMRC know what her untaxed income is for FY 25/26, when financial year ends 5 April 26?

poseidon1

OP, now that your wife has fallen into self assessment, have you considered the possibility of employing an accountant to handle the matter rather than yourself?

Yes, I appreciate this forum is all about self help, and the contributors here are more than willing to provide guidance.

However you have very significant cash assets between you, and my sense is you take the lead in deploying and managing those assets. However if something were to happen to you (incapacity, death etc) and since I note you have no children, who would assist your wife in that scenario?

In this situation, having a professional to fall back on to assist you both with regard to tax compliance matters in the first instance, this could be a beneficial arrangement over the longer term.

Bearing in mind some Chartered Accountancy tax practices are also able to handle probate administration, this could provide you with peace of mind that a professional you already have a business relationship with, could be of real potential assistance to your wife, if there are no obvious family members who could step up in your absence.

Just a thought?

Shylock_249

https://forums.moneysavingexpert.com/discussion/comment/81889777#Comment_81889777

Because my tax code letter for 26/27 estimated untaxed interest at 14k based on last years (correct) 24/25 interest but I knew it was 12k for this FY because all of our taxable accounts have already paid the interest and I was able to log on to Gov Gateway and adjust the figures. I wish I hadn't.

All our taxable savings accounts are in joint names. I notified HMRC for both of us on the same day. HMRC have accepted my figures but didn't change the wife's, ie it still shows 14k despite writing to her asking for a list of of the banks and the interest paid.

Edit: If I knew how to make reference to a previous post I'd show it here.

Shylock_249

https://forums.moneysavingexpert.com/discussion/comment/81889851#Comment_81889851

Thanks.

I do keep meticulous records so whilst I'm alive I can do it but as you say if I fall over, I don't know how the wife would cope. We have 5 joint accounts, 4 fixed and one immediate access, I have 7 ISAs and the wife has 8 all one year fixed. 37% is in taxable accounts the rest in ISAs.

But my worry about Self Assessment is making the original return inasmuch as HMRC have finalised my 24/25 PAYE account and I owe them 2k which I have to pay by 29 April. They still haven't finalised the wife's. When they do I'm pretty sure her bill will be larger than mine based on her HMRC estimates for previous years which I didn't challenge - because I didn't know how to do it.

If I was to have a clean start I don't think I'll have a problem.

Probate would be a worry for my wife, actually impossible. We made wills a couple of years ago and the solicitors said they would handle probate for the wife if she were the last survivor.

I wrote to Rachel in Accounts suggesting that married couples of a certain age aught to be able to merge their ISAs that way there would be no need for probate in the same way as there is no need for probate with taxable interest accounts in joint names where the bank just needs a copy of the death certificate and they will scratch one name from the account.

With interest rates falling I expect 12k in this FY will probably drop considerably and in two years will be well below 10k. I remember when 0.5% rates were around.

Thanks

poseidon1

https://forums.moneysavingexpert.com/discussion/comment/81889935#Comment_81889935

I think you are making my case to delegate your wife's tax compliance to an Accountant.

Yes I can see you a clearly managing your joint saving funds with no issues, but I can also see this new tax compliance requirement for your wife has already become a bit of a nuisance and perhaps increasingly burdensome has time goes on.

Delegating tax compliance to a professional who can resolve matters quickly and effectively, frees you up to get on with life.

I note you have a solicitor lined up to handle probate in due course, but that's where their role will start and end. Surely a continuing relationship with a decent Accountant will be useful now and in the foreseeable future?

Shylock_249

https://forums.moneysavingexpert.com/discussion/comment/81889987#Comment_81889987

Sure, but I'd be forever forwarding him information. When I reinvest an ISA with a bank, it will issue a new account number, if I decide to move providers again, a new number. 15 ISAs all on one year fixed rates & 5 Taxable accounts, he'd be sick of the site of me and then again, he's liable for errors of omission and commission and I'd wonder if he had the same figures as mine at the end of a year.

I need to adopt a 40 year old son or daughter!

poseidon1

https://forums.moneysavingexpert.com/discussion/comment/81890018#Comment_81890018

An accountant will have no interest in hearing from you about any of the ISAs, current or in future.

They are invisible for the purposes of income tax compliance, so all the accountant will require is your year end tax certificates for all the taxable saving accounts, and any P60s relevant to taxable employment pensions.

You should have no need to liase with the accountant more than a couple of times of year, once to forward all the relevant certificates and advise on accounts that closed, and again to agree contents of the tax return prior to filing with HMRC.

Incidentally the accountant is never liable to HMRC for a client's omissions or oversight. That responsibility always rests with the client.

In the absence of adopting a conveniently skilled adult child, an accountant is the next best thing and probably cheaper in the long run!

Shylock_249

https://forums.moneysavingexpert.com/discussion/comment/81890213#Comment_81890213

Thanks

Surely the accountant would need to know about ISAs when completing Probate? All of our 15 ISAs are above the individual bank's probate limit.

One thing I have done is to complete a "Doomsday" document listing bank account numbers, addresses, pension providers (4), Credit Cards, Utilities, Insurance Companies, Media, Library Cards, Land Registry etc etc. This would certainly assist someone in acting as Executor and completing probate.

If NS&I did transfer in ISAs I'd place all our ISAs in there irrespective of the rates, having just one each instead of 7 & 8 would be a bonus.

Thanks again

poseidon1

https://forums.moneysavingexpert.com/discussion/comment/81890909#Comment_81890909

You indicated that you have lined up a firm of solicitors to handle probate when the time comes, so that is information they would obtain from your 'Doomsday' document in due course.

Of course if you do engage a firm of Accountants to handle annual self assessment, and are sufficiently impressed with them to consider giving them the brief to handle probate ( instead of the solicitor), then they would be provided access to the Doomsday document by your widow instead.

Until your passing, an accountant has no need to have any knowledge of your ISAs for routine annual self assessment purposes. Indeed if you think about the information you are trying to compile for your wife's self assessment, the ISAs are not part of what you are attempting to report on her behalf, so difficult to see why you feel an Accountant would routinely need that information.