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  • FIRST POST
    • ajo
    • By ajo 10th Aug 18, 11:19 AM
    • 88Posts
    • 3Thanks
    ajo
    Halifax and Bank of Scotland taking tax from interest
    • #1
    • 10th Aug 18, 11:19 AM
    Halifax and Bank of Scotland taking tax from interest 10th Aug 18 at 11:19 AM
    I am just in the process of reviewing all my accounts with rewards etc. (this may take some time as I have been meaning to do it for a while) anyway. I have noticed on my statements that Halifax have taken tax from the gross, reducing the net.

    The previous payment this didn't happen and this is all still under 1000 interest.

    Is this correct, has anything changed?

    Thanks
Page 1
    • Ed-1
    • By Ed-1 10th Aug 18, 11:22 AM
    • 2,388 Posts
    • 1,244 Thanks
    Ed-1
    • #2
    • 10th Aug 18, 11:22 AM
    • #2
    • 10th Aug 18, 11:22 AM
    I am just in the process of reviewing all my accounts with rewards etc. (this may take some time as I have been meaning to do it for a while) anyway. I have noticed on my statements that Halifax have taken tax from the gross, reducing the net.

    The previous payment this didn't happen and this is all still under 1000 interest.

    Is this correct, has anything changed?

    Thanks
    Originally posted by ajo
    They won't be taking tax from interest.

    They'll be taking tax from reward payments as these are 'other income' (not interest).
    • ajo
    • By ajo 10th Aug 18, 11:36 AM
    • 88 Posts
    • 3 Thanks
    ajo
    • #3
    • 10th Aug 18, 11:36 AM
    • #3
    • 10th Aug 18, 11:36 AM
    They won't be taking tax from interest.

    They'll be taking tax from reward payments as these are 'other income' (not interest).
    Originally posted by Ed-1
    So the percentage quoted is not "interest" but a "reward"?

    The previous year nothing was taken.
    • eskbanker
    • By eskbanker 10th Aug 18, 11:39 AM
    • 8,212 Posts
    • 9,215 Thanks
    eskbanker
    • #4
    • 10th Aug 18, 11:39 AM
    • #4
    • 10th Aug 18, 11:39 AM
    So the percentage quoted is not "interest" but a "reward"?
    Originally posted by ajo
    You tell us - what is the actual description of the payment you're referring to and how much is it?

    Edit: Bank of Scotland reduced its Vantage interest rate from 2% to 1.5% from 1 July, would that explain a lower interest payment?
    Last edited by eskbanker; 10-08-2018 at 12:03 PM. Reason: Added Vantage rate reduction
    • Zanderman
    • By Zanderman 10th Aug 18, 12:04 PM
    • 1,831 Posts
    • 4,509 Thanks
    Zanderman
    • #5
    • 10th Aug 18, 12:04 PM
    • #5
    • 10th Aug 18, 12:04 PM
    I am just in the process of reviewing all my accounts with rewards etc. (this may take some time as I have been meaning to do it for a while) anyway. I have noticed on my statements that Halifax have taken tax from the gross, reducing the net.

    The previous payment this didn't happen and this is all still under 1000 interest.

    Is this correct, has anything changed?

    Thanks
    Originally posted by ajo
    You mention accounts with 'rewards' - rewards are not interest.
    • pochisoldi
    • By pochisoldi 10th Aug 18, 12:16 PM
    • 141 Posts
    • 85 Thanks
    pochisoldi
    • #6
    • 10th Aug 18, 12:16 PM
    • #6
    • 10th Aug 18, 12:16 PM
    Halifax Rewards are not interest they are classified as "Annual Payments" under the tax rules, which means they get treated the way interest used to be: basic rate tax deducted at source, paid over to HMRC, and a tax certificate issued to the recipient after the end of the tax year.

    This is due to the (idiotic)* way that Halifax have structured their reward scheme.

    More info on the tax side at:
    https://www.gov.uk/hmrc-internal-manuals/savings-and-investment-manual/saim8010

    PochiSoldi

    * Idiotic, because Barclays fixed this issue nearly a year ago by simply rewording their reward scheme T&Cs. All Halifax have to do is to copy the Barclays structure, and simply drop the obligation to stay in credit in order to get the reward.
    • eskbanker
    • By eskbanker 10th Aug 18, 12:39 PM
    • 8,212 Posts
    • 9,215 Thanks
    eskbanker
    • #7
    • 10th Aug 18, 12:39 PM
    • #7
    • 10th Aug 18, 12:39 PM
    Idiotic, because Barclays fixed this issue nearly a year ago by simply rewording their reward scheme T&Cs. All Halifax have to do is to copy the Barclays structure, and simply drop the obligation to stay in credit in order to get the reward.
    Originally posted by pochisoldi
    That presupposes that Halifax see this as an 'issue' that needs to be 'fixed'....
    • badmemory
    • By badmemory 10th Aug 18, 8:45 PM
    • 2,115 Posts
    • 2,975 Thanks
    badmemory
    • #8
    • 10th Aug 18, 8:45 PM
    • #8
    • 10th Aug 18, 8:45 PM
    It won't matter in a couple of years anyway because they will have reduced it out of existence.
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