PPi tax reclaim resulted in big tax bill

I got a big PPi payout plus £9999 interest as a 20% tax payer. I got taxed £1900 taken off so claimed for the tax back afer reading Martin€‘S money. I got a shock on Friday as instead of an expected cheque for £1900 I got a tax bill for an additional £1500 to be paid within 2 weeks. I am gutted. Apparently the interest took me over the tax threshold. I had no Idea. Is there anything I can do please.

Comments

  • [Deleted User]
    [Deleted User] Posts: 26,612 Forumite
    First Anniversary Name Dropper Photogenic First Post
    Docwit wrote: »
    Is there anything I can do please.
    Pay the additional tax from your "big payout" before you spend it?
  • antrobus
    antrobus Posts: 17,386 Forumite
    Docwit wrote: »
    I got a big PPi payout plus £9999 interest as a 20% tax payer. I got taxed £1900 taken off so claimed for the tax back afer reading Martin€‘S money. I got a shock on Friday as instead of an expected cheque for £1900 I got a tax bill for an additional £1500 to be paid within 2 weeks. I am gutted. Apparently the interest took me over the tax threshold. I had no Idea. Is there anything I can do please.

    As a '20% tax payer', you would not have been due a refund anyway.

    The only thing you can do is pay the £1,500.
  • BoGoF
    BoGoF Posts: 7,099 Forumite
    Name Dropper First Anniversary First Post
    edited 13 October 2019 at 9:58PM
    antrobus wrote: »
    As a '20% tax payer', you would not have been due a refund anyway.

    The only thing you can do is pay the £1,500.

    Yes they would if the interest kept them in the 20% rate band they would have still been entitled to the £1000 nil rate savings band. So around £200 if a basic rate taxpayer including interest.

    I assume the additional £9999 income tipped them into the higher rate bracket.
  • BoGoF
    BoGoF Posts: 7,099 Forumite
    Name Dropper First Anniversary First Post
    And o/p has confirmed it took them into 40% tax bracket on their other thread.

    It's income, it's taxable (or some of it at) at 40%, you only paid 20% so you need to pay what's owing. There is nothing else you can do.
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