Starting rate for savings

richardgpesque

OK, understood. Thank you all very much

zagfles

https://forums.moneysavingexpert.com/discussion/comment/82147039#Comment_82147039

They don't have to change the "whole PAYE system". They can make a simple change to not deduct estimated interest from the tax code of people expected to earn under the PA. Trivially easy.

Can you point me at this "statute law" that says the PAYE tax code must be reduced by estimated interest for people expected to earn under the PA? I never knew statue law was that specific about how HMRC must operate PAYE. After all the PAYE tax code doesn't always reflect available PA, for instance someone who receives a MA transfer has their PAYE tax code increased even though their PA isn't increased, the PAYE tax code for a HRT payer who pays into a pension is usually increased, their PA is not increased.

The whole point of the PAYE tax code, as the above examples show, is to try to collect the right amount of tax. The right amount of tax will almost always be collected if they ignore interest when setting the tax code of people expected to earn under the PA.

poseidon1

https://forums.moneysavingexpert.com/discussion/comment/82155745#Comment_82155745

The enabling legislation is a combination of primary and secondary legislation.

Primary via Section 684 ITEPA 2003 and an explicit secondary statutory instrument in the form of SI 2003 no. 2682 - see

https://www.gov.uk/hmrc-internal-manuals/paye-manual/paye12060

Where UK tax is concerned, even though the statutes and subordinate regulations may not be visible to you, you can rest assured they do exsist.

Any changes to the status quo you feel sensible and appropriate, you should no doubt take up with your MP as suggested upthread.

zagfles

https://forums.moneysavingexpert.com/discussion/comment/82156380#Comment_82156380

That seems to give HMRC the authority to include non PAYE income in the tax code, but unless I'm missing something it doesn't mandate them to. In fact it specifically states that SA customers can opt out.