We'd like to remind Forumites to please avoid political debate on the Forum. This is to keep it a safe and useful space for MoneySaving discussions. Threads that are - or become - political in nature may be removed in line with the Forum’s rules. Thank you for your understanding.

Gross Interest without tax being deducted

At present, the majority of our savings are in Mrs Hansi's name because currently she does not go over the £4745 threshold. Howeveer come January she will start to receive her State Pension which will take her over the threshold. My question is this, she will not go over the threshold in the current (04/05 tax year) so can I delay contacting the banks and building societies until 5 April next year or do I have to tell them in January?

Comments

  • hansi
    hansi Posts: 3,001 Forumite
    Part of the Furniture 1,000 Posts
    I believe someone just replied to me but the post is not shown :)
  • My guess is that if you know that her total income in 2004-2005 will exceed the personal allowance for 2004-2005 then you should inform banks and building societies that the R85 is no longer valid.
    I think it says something to that effect on the R85 form.
    ...............................I have put my clock back....... Kcolc ym
  • dunstonh
    dunstonh Posts: 118,546 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    i pressed reply but it timed out.

    Quick answer is to it at the beginning of the next tax year.   Do it early as possible as it will take a month or two to correct but it will be auto corrected to take into account any interest paid in April, for example.


    edit: Robert's post didnt appear for me either until i replied again with mine.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • hansi
    hansi Posts: 3,001 Forumite
    Part of the Furniture 1,000 Posts
    My guess is that if you know that her total income in 2004-2005 will exceed the personal allowance for 2004-2005 then you should inform banks and building societies that the R85 is no longer valid.
    I think it says something to that effect on the R85 form.

    her income for 2004/2005 will not exceed her personal allowance for that year, it will start in the next tax year, so I gues I don't have to tell them until after 5th April 2005
  • Quite so.
    ...............................I have put my clock back....... Kcolc ym
  • deemy2004
    deemy2004 Posts: 6,201 Forumite
    contact them next tax year, IF you owe any tax then you can pay it at the end of next year.

    Remember that its WHEN you recieve the interest, is the year when your liable for tax on it.

    So would effect anniversary accounts such as the cahoot 5.65% where the whole interest is liable in the 2005/06 year eventhough you may have opened it in July 04.
This discussion has been closed.
Meet your Ambassadors

🚀 Getting Started

Hi new member!

Our Getting Started Guide will help you get the most out of the Forum

Categories

  • All Categories
  • 348.2K Banking & Borrowing
  • 252.1K Reduce Debt & Boost Income
  • 452.3K Spending & Discounts
  • 240.7K Work, Benefits & Business
  • 617K Mortgages, Homes & Bills
  • 175.6K Life & Family
  • 253.9K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 16K Discuss & Feedback
  • 15.1K Coronavirus Support Boards

Is this how you want to be seen?

We see you are using a default avatar. It takes only a few seconds to pick a picture.