Tax Free Savings Guide

[FONT=&quot]http://www.moneysavingexpert.com/savings/tax-free-savings?_ga=1.160952373.909080728.1427992360 [/FONT]

"Then, from next April, the personal savings allowance will supersede these tax-free savings rules, BUT anyone who qualifies under these tax-free savings rules will get a higher £2,000 personal savings allowance for that year, instead of the £1,000 that will apply for other basic-rate taxpayers"





[FONT=&quot]Have I missed something :huh:
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[FONT=&quot]https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/414026/Savings_factographic_final.pdf[/FONT]

"That means from April 2016, you won’t have to
pay tax on your interest if your taxable income is
less than 16,800"

Do student loan maintenance allowances, career development loans or PhD stipends count towards the savings threshold or are they considered tax free? They're not subject to income tax, so perhaps aren't really designated as "earnings."

Jsknight100,
I would think the annuity is in fact income rather than savings, so my thoughts are that the money from that is in the realms of your personal tax allowance, i.e. £10,600 for a basic tax payer.

I very much doubt that it would be seen as savings .. It is pension income. You would take the gross amount of the income from the annuity plus the gross interest amount from any savings that you have (excluding ISA's as they are tax exempt anyway) and once you have a total combined figure, you can then work out exactly what you are eligible to claim.

If the total is under £15,600 then you will not pay any tax on your savings, but if the annuity income is over £10,600 (or whatever your personal allowance is for this tax year) then you will pay income tax on that annuity income, as per normal income earnings.

I have tried to explain it here in simple terms, but there are more complicated issues where the total falls between £10,600 and £15,600 and the savings interest takes you just over the £15,600 limit... In which case you end up paying tax on all the savings interest, but can claim a proportion of it back (on a sliding scale) at the end of the Financial year.

Note it has to be the savings account interest that takes you over the £15,600 threshold and your income still needs to be below the 2015/16 personal allowance of £10,600.

Let's just try to keep it simple at this stage though. It could be more complicated if the annuity is index linked and it increases part way through the financial year because you have to include those increases in your calculation of the totals.

That's how I view it from the articles I have read.

BianchiMonoQ wrote: »

Does interest from P2P lending (Zopa, Ratesetter, etc) count as savings interest in this context? Rang HMRC today and they couldn't give a definitive response.

That's probably not surprising as the law hasn't even been implemented yet.

I would expect it to qualify but until the proposal is passed into law then you won't know for sure.

apologies if this has already been covered... with the new rules from april 15 I needn't pay tax on my savings. does anyone know whether i can claim back the interest I've already paid this financial year to date, and if so how? thanks