HMRC tax return query
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Wig
Posts: 14,139 Forumite
Hi,
Someone has a savings account in France, the French bank said as the person lives in the UK they will set it up as non taxed account, but told them the person must declare the interest to tax man in UK.
This was about 6 years ago.
The person never told the HMRC -out of not bothering rather than out of deception.-
I estimate the interest in the account to be about 100 Euro per year
at the most maybe double that depending on what interest rate was.
So £80 - £160 per year. income which at tax rates would be 20% so undeclared tax due £16 - 32 per year?
They are employed not self employed, so they never file a tax return.
They now need to clear the mistake with the HMRC retrospectively
Is it the case that if the amount of unpaid tax is less than £100 per year there would be no penalty from HMRC?
A related question... I thought in UK we did not pay tax in UK bank accounts anymore is this true? or is 20% still deducted by the bank on the bank statement? If true, does this mean everyone in UK should be filing tax returns for whatever interest they got from the bank every year?
Someone has a savings account in France, the French bank said as the person lives in the UK they will set it up as non taxed account, but told them the person must declare the interest to tax man in UK.
This was about 6 years ago.
The person never told the HMRC -out of not bothering rather than out of deception.-
I estimate the interest in the account to be about 100 Euro per year
at the most maybe double that depending on what interest rate was.
So £80 - £160 per year. income which at tax rates would be 20% so undeclared tax due £16 - 32 per year?
They are employed not self employed, so they never file a tax return.
They now need to clear the mistake with the HMRC retrospectively
Is it the case that if the amount of unpaid tax is less than £100 per year there would be no penalty from HMRC?
A related question... I thought in UK we did not pay tax in UK bank accounts anymore is this true? or is 20% still deducted by the bank on the bank statement? If true, does this mean everyone in UK should be filing tax returns for whatever interest they got from the bank every year?
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Comments
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Well, in 2016/17 and 2017/18 there was a savings allowance of £1,000 for basic rate tax payers (£500 for higher rate) - so as long as their total interest is below this, there shouldn't be an issue - technically HMRC can issue a penalty for 30% for careless errors, but I would say 30% of £0 unpaid tax is £0....
I also believe there is a de-minimis limit of £300 of the top of my head - so you probably want to check that.0 -
Since April 2016 everyone has a personal savings allowance, which is why interest is mow paid without a tax deduction.
What is their UK annual salary?0 -
Annual salary £24,000(?) - £26,000 (2017)
So for the years starting April 2012(possibly), April 2013, April 2014 April 2015, What is the best course of action?
First we will need to find the bank statements to see exactly what we are dealing with ..but what next?0 -
As that person failed to notify chargeability by 30 September 2018, HMRCs standard penalty is 200% of the tax due (in addition to the tax).0
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Cook_County wrote: »As that person failed to notify chargeability by 30 September 2018, HMRCs standard penalty is 200% of the tax due (in addition to the tax).
Yes, but 200% of £0 unpaid tax is still £0.
I would probably say that HMRC will treat this as careless - I believe HMRC are wasting their time (unless we haven't been told all the facts of course).0
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