Should I pay tax on savings if I'm not earning

bristolleedsfan

mister_bojangles wrote: »

Steffan
I'm not a tax expert, With £35,000 in an account, you are more comfortable than many of us who are employed. Until the savings falls below a particular threshold, any 'rich' person like you should pay tax. Reflect on this, it may answer your question.

Steffan: 2007/08 Tax year a single person has an allowance of 5225.00 before they are liable for income tax.

http://www.hmrc.gov.uk/rates/it.htm ( 5435 in Tax Year 2008/09)

For illustration purposes if a single person only has savings income then 85000 savings @ 6% Gross interest equates to 5100 in income. ( below the above allowance threshold, therefore no tax is payable )


http://www.direct.gov.uk/en/MoneyTaxAndBenefits/PensionsAndRetirement/MoneyInRetirement/DG_10024687

Reclaiming overpaid tax on savings

If you think you've paid tax on your savings interest when you didn't need to or paid more than you should have (either because you were a non-taxpayer or only a 10 per cent taxpayer) – you can claim to get it back. You have five years from the 31 January after the end of the relevant tax year in which to claim.
You claim the tax back on form R40. You can download this below, use the HM Revenue & Customs online forms ordering service or ask your Tax Office or the HMRC Office that deals with repayment claims for your area. You should usually get your repayment within 15 days but this could take longer when the repayment offices are busy.

• Order form R40 online to be posted to you (opens new window)
• Download form R40 to claim for a repayment of tax (PDF document, 61KB) (opens new window)
• Help with PDF files

Geoffo_M

mister_bojangles wrote: »

Steffan
I'm not a tax expert, but your question brought a similar question to my mind: 'if I'm a footballer earning £100,000 per week and get injured and no longer play football, should I pay tax because I'm no longer employed, even thought I have £1.55m in my bank account?'. With £35,000 in an account, you are more comfortable than many of us who are employed. Until the savings falls below a particular threshold, any 'rich' person like you should pay tax. Reflect on this, it may answer your question.

I've never heard such rubbish. There is no way having £35,000 in savings makes you a "rich person". We pay enough in taxes without giving the state tax to which it is not entitled. Simply Steffan you have overpaid tax and are entitled to a refund.

mister_bojangles

Geoffo M
I don't think that we should use this forum to vent our frustration on UK tax policies. I'm not pleased with the cost of living too, but this is a forum to educate one another, not 'having a go'.

I have not suggested that having £35000 makes you rich. Read bristolleedsfan's input above on my reference to a threshold above which every single person pays tax.

bristolleedsfan

mister_bojangles wrote: »

Geoffo M

but this is a forum to educate one another.

:T

“sometimes messages are posted that are poorly researched, ill-conceived, downright wrong or sadly even worse, misleading and deceptive”

http://forums.moneysavingexpert.com/showthread.html?t=304878

cheeks

I am just applying for gross interest on my savings as im a full-time mum at the moment. i was just wondering whether i could also apply for gross interest on a joint accounts i have with my husband? woud we only have to pay half the tax on these account or doesn't it work like that? x

elektra

cheeks wrote: »

I am just applying for gross interest on my savings as im a full-time mum at the moment. i was just wondering whether i could also apply for gross interest on a joint accounts i have with my husband? woud we only have to pay half the tax on these account or doesn't it work like that? x

Yes, you can. I have done so for years with Abbey current account. I believe it applies the gross to half. In reality my husband was the only one paying into the account.

Mikeyorks

cheeks wrote: »

i was just wondering whether i could also apply for gross interest on a joint accounts i have with my husband? woud we only have to pay half the tax on these account or doesn't it work like that? x

That is how it would work ... if they accept it. But not all Banks / BS's will accept an R85 from only one of the parties to a joint account .... it's both or neither. (see post #3 on this link - and read the HMRC embedded link)

http://forums.moneysavingexpert.com/showthread.html?p=9662183#post9662183

cheeks

Thank you both for your help, i'll find out if Alliance and Leicester will accept it.
P.S Mikeyorks - great signature!