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  • FIRST POST
    • MoneySavingTart
    • By MoneySavingTart 13th Jan 20, 8:40 PM
    • 81Posts
    • 17Thanks
    MoneySavingTart
    Demand for tax on untaxed interest
    • #1
    • 13th Jan 20, 8:40 PM
    Demand for tax on untaxed interest 13th Jan 20 at 8:40 PM
    HMRC have just sent a demand for tax they say is due on untaxed interest for 2018/19.
    The demand simply states an amount of untaxed interest and the tax due on it.
    There are no details of the source of this untaxed interest and so it is impossible for me to check if they are correct.

    If any other company sent an invoice for payment they would have to say what was being paid for.

    Do I just have to accept HMRC are correct and pay up or an I entitled to a breakdown of where this interest came from.

    NB they are quite possibly correct that I have bank/BS interest untaxed but I feel i ought to be able check their working.

    Thanks
    MST
Page 2
    • newatc
    • By newatc 15th Jan 20, 9:11 AM
    • 527 Posts
    • 658 Thanks
    newatc
    Some points from reading this thread from my experience:

    1. Do not accept that the HMRC figure is correct. They have been way out on mine for last few tax years.

    2. Historically, at least, sending them your own figures can serve to confuse because their automatic system of receiving info from banks has matching problems that leads to duplication (they tell me the process has now been improved).

    3. After numerous frustrating telephone calls, I sent a letter with heading of COMPLAINT and finally someone had a detailed look at my situation and he phoned me accepting my figures and put things right (until next tax year end at least!). There is a Compaints system and, if you got your details correct, it works and is worth doing.
    • badger09
    • By badger09 15th Jan 20, 3:44 PM
    • 7,626 Posts
    • 7,131 Thanks
    badger09
    I thought you might fail that test

    if you fill out the questionnaire in such a way that the end result is no you do not have to do a tax return, the last bit at the bottom of the final page contains the info i have quoted because that is the fall back position for someone who is not required to do the full horrors of a tax return, but nonetheless has not paid tax on income they have received and so still have a duty to inform HMRC of that fact and pay the tax due on it.
    Originally posted by 00ec25
    That questionnaire showed that I should complete SA Return because I need(ed) to pay tax on 2500 or more in interest.

    Which is at odds with the 10k figure mentioned here, https://www.gov.uk/apply-tax-free-interest-on-savings
    which is what I had understood the position to be

    As a retired Snr Inspector of Taxes, I'm well aware of my duty to inform HMRC about, and pay tax due on, my untaxed interest. Unfortunately I've had to write several times, and escalate to a formal complaint, to persuade HMRC to correct its many errors concerning that interest.
    • Dazed and confused
    • By Dazed and confused 15th Jan 20, 4:28 PM
    • 6,252 Posts
    • 3,351 Thanks
    Dazed and confused
    As far as untaxed interest is concerned my understanding was that it is the 10k figure which is relevant as far the requirement for a Self Assessment return is concerned.

    Sadly gov.uk is not the reliable source it should be.

    For example the insistence on referring to the Personal Savings Allowance (admittedly a confusing name) as an allowance and not a tax rate/band is a perfect example of this.
    • MoneySavingTart
    • By MoneySavingTart 15th Jan 20, 5:20 PM
    • 81 Posts
    • 17 Thanks
    MoneySavingTart
    Apart from the format of the calculations, does it make any difference if the PSA is treated as an allowance or a zero rated band?

    MST
    • Pennywise
    • By Pennywise 15th Jan 20, 7:10 PM
    • 12,518 Posts
    • 25,121 Thanks
    Pennywise
    Apart from the format of the calculations, does it make any difference if the PSA is treated as an allowance or a zero rated band?

    MST
    Originally posted by MoneySavingTart
    At certain income levels and at certain splits of that income, yes, very much matters.
    • unholyangel
    • By unholyangel 15th Jan 20, 9:16 PM
    • 14,366 Posts
    • 11,495 Thanks
    unholyangel
    My understanding is that the 10k is the limit for savings & investment income (dividends, savings interest etc).

    The 2.5k limit is for other interest (aka interest that is not paid on savings & investments).
    Money doesn't solve poverty.....it creates it.
    • badger09
    • By badger09 16th Jan 20, 2:44 PM
    • 7,626 Posts
    • 7,131 Thanks
    badger09
    My understanding is that the 10k is the limit for savings & investment income (dividends, savings interest etc).

    The 2.5k limit is for other interest (aka interest that is not paid on savings & investments).
    Originally posted by unholyangel
    That had always been my understanding.

    However, the questionnaire about whether SA Return is needed or not, omits the word 'other' before 'interest'.
    • badger09
    • By badger09 16th Jan 20, 2:47 PM
    • 7,626 Posts
    • 7,131 Thanks
    badger09
    As far as untaxed interest is concerned my understanding was that it is the 10k figure which is relevant as far the requirement for a Self Assessment return is concerned.
    Originally posted by Dazed and confused
    Mine too. Hence my confusion over the Questionnaire.


    Sadly gov.uk is not the reliable source it should be.
    Originally posted by Dazed and confused

    I nominate that sentence for "Understatement of the Year".
    • unholyangel
    • By unholyangel 16th Jan 20, 9:19 PM
    • 14,366 Posts
    • 11,495 Thanks
    unholyangel
    That had always been my understanding.

    However, the questionnaire about whether SA Return is needed or not, omits the word 'other' before 'interest'.
    Originally posted by badger09
    Yeah I had a look earlier and it does appear their "checker" is misleading. All they need to do is put (excluding savings interest) after it.

    I've went back and clicked on the something wrong with this page link at the bottom right and asked them to clarify - lest they want to create more work for themselves.
    Money doesn't solve poverty.....it creates it.
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