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  • FIRST POST
    • Maureen43
    • By Maureen43 5th Jan 18, 7:13 AM
    • 483Posts
    • 634Thanks
    Maureen43
    Do I need to tell the bank I am now a tax payer?
    • #1
    • 5th Jan 18, 7:13 AM
    Do I need to tell the bank I am now a tax payer? 5th Jan 18 at 7:13 AM
    Morning

    I now have a new job which means I am a tax payer.

    Do I need to tell my banks/building societies about this or is this not necessary as everyone now gets a tax free savings allowance of £1000?

    Or do they get the information from HMRC anyway?

    I'd be grateful for some advice!

    Thanks
    M.
Page 1
    • glider3560
    • By glider3560 5th Jan 18, 7:27 AM
    • 3,582 Posts
    • 2,274 Thanks
    glider3560
    • #2
    • 5th Jan 18, 7:27 AM
    • #2
    • 5th Jan 18, 7:27 AM
    Tax is no longer deducted from savings at source. Instead, you have to tell HMRC if you exceed the £1,000 (or £500) limit. They will arrange for the payment to be made directly or through your tax code.

    • newatc
    • By newatc 5th Jan 18, 9:21 AM
    • 248 Posts
    • 281 Thanks
    newatc
    • #3
    • 5th Jan 18, 9:21 AM
    • #3
    • 5th Jan 18, 9:21 AM
    Morning

    Or do they get the information from HMRC anyway?

    I'd be grateful for some advice!

    Thanks
    M.
    Originally posted by Maureen43
    HMRC get the information from the Banks etc. Theoretically (and practically for the vast majority) you have to tell HMRC nothing though ultimately it is your responsibility to ensure all tax is paid.
    Last edited by newatc; 05-01-2018 at 9:43 PM. Reason: Typos and lazy posting.
    • greenglide
    • By greenglide 5th Jan 18, 9:59 AM
    • 3,104 Posts
    • 2,020 Thanks
    greenglide
    • #4
    • 5th Jan 18, 9:59 AM
    • #4
    • 5th Jan 18, 9:59 AM
    They get the information from HMRC.
    No they don't!

    Banks and building societies have no interest in your tax situation for normal savings accounts, especially with the new savings allowance.
    • IanManc
    • By IanManc 5th Jan 18, 11:12 AM
    • 544 Posts
    • 886 Thanks
    IanManc
    • #5
    • 5th Jan 18, 11:12 AM
    • #5
    • 5th Jan 18, 11:12 AM
    No they don't!

    Banks and building societies have no interest in your tax situation for normal savings accounts, especially with the new savings allowance.
    Originally posted by greenglide
    This is what the HMRC says on the Gov.uk website:

    "You don!!!8217;t need to do anything to claim your Personal Savings Allowance.
    If you fill in a Self Assessment tax return you should carry on doing this as normal.
    If you!!!8217;re a basic rate taxpayer and have savings income or interest of more than £1,000 (£500 for higher rate taxpayers), you!!!8217;ll have to pay some tax on this.
    HM Revenue and Customs (HMRC) will normally collect the tax by changing your tax code. Banks and building societies will give HMRC the information they need to do this."
    Last edited by IanManc; 05-01-2018 at 1:18 PM.
    • ColdIron
    • By ColdIron 5th Jan 18, 11:47 AM
    • 4,261 Posts
    • 5,394 Thanks
    ColdIron
    • #6
    • 5th Jan 18, 11:47 AM
    • #6
    • 5th Jan 18, 11:47 AM
    Banks and building societies will give HMRC the information they need to do this.
    Originally posted by IanManc
    Correct, HMRC will get the information from the banks, but the point under discussion is

    Or do they get the information from HMRC anyway?
    OP, there is no need to inform your bank of your tax status
    • 18cc
    • By 18cc 5th Jan 18, 12:22 PM
    • 534 Posts
    • 324 Thanks
    18cc
    • #7
    • 5th Jan 18, 12:22 PM
    • #7
    • 5th Jan 18, 12:22 PM
    Assuming of course this is a job where you are resident in the UK for tax purposes!
    • ivormonee
    • By ivormonee 5th Jan 18, 12:26 PM
    • 165 Posts
    • 102 Thanks
    ivormonee
    • #8
    • 5th Jan 18, 12:26 PM
    • #8
    • 5th Jan 18, 12:26 PM
    You also have the starting rate of 0% on £5,000 of interest subject to what's available from your personal allowance after your employment income is taken into account.
    • IanManc
    • By IanManc 5th Jan 18, 1:09 PM
    • 544 Posts
    • 886 Thanks
    IanManc
    • #9
    • 5th Jan 18, 1:09 PM
    • #9
    • 5th Jan 18, 1:09 PM
    Correct, HMRC will get the information from the banks, but the point under discussion is

    OP, there is no need to inform your bank of your tax status
    Originally posted by ColdIron
    I've quoted how the allowance works but I see your point now. The banks tell HMRC, obviously not the other way around (!) and I'd misunderstood what a previous poster was saying and I've altered my previous posting.

    Cheers Mr ColdIron.
    Last edited by IanManc; 05-01-2018 at 1:22 PM.
    • roxy28
    • By roxy28 5th Jan 18, 2:19 PM
    • 655 Posts
    • 59 Thanks
    roxy28
    You also have the starting rate of 0% on £5,000 of interest subject to what's available from your personal allowance after your employment income is taken into account.
    Originally posted by ivormonee
    Can you give a example for say someone on £10,000 per year with a PA of £11,500

    And
    Someone on £13,000 with a PA of £11,500.
    • soulsaver
    • By soulsaver 5th Jan 18, 2:33 PM
    • 1,718 Posts
    • 687 Thanks
    soulsaver
    Morning

    I now have a new job which means I am a tax payer.

    M.
    Originally posted by Maureen43
    Not sure this is appropriate...but congratulations
    • Maureen43
    • By Maureen43 5th Jan 18, 8:51 PM
    • 483 Posts
    • 634 Thanks
    Maureen43
    Assuming of course this is a job where you are resident in the UK for tax purposes!
    Originally posted by 18cc
    Yes I am. Thanks
    • Maureen43
    • By Maureen43 5th Jan 18, 8:52 PM
    • 483 Posts
    • 634 Thanks
    Maureen43
    You also have the starting rate of 0% on £5,000 of interest subject to what's available from your personal allowance after your employment income is taken into account.
    Originally posted by ivormonee
    Sorry, please could you explain this a bit more?
    • Maureen43
    • By Maureen43 5th Jan 18, 8:53 PM
    • 483 Posts
    • 634 Thanks
    Maureen43
    Not sure this is appropriate...but congratulations
    Originally posted by soulsaver
    It is appropriate. Itís been a long time coming. Thank you!
    • Dazed and confused
    • By Dazed and confused 5th Jan 18, 9:40 PM
    • 2,644 Posts
    • 1,266 Thanks
    Dazed and confused
    Maureen43

    You also have the starting rate of 0% on £5,000 of interest subject to what's available from your personal allowance after your employment income is taken into account.
    Originally posted by ivormonee

    Sorry, please could you explain this a bit more?

    Tax on savings interest is more complicated than wages!

    UK residents (with income less than £100,000) all get a Personal Allowance and then there are a variety of tax rates when income over the personal allowance is taxed.

    Two of these relating to savings income are the starter savings rate and the personal savings allowance rate, both of which are taxed at 0%.

    For example if you have (current tax year) salary of £13000 then you would pay basic rate tax on £1500 (difference between £13000 and PA of £11500).

    But if you also had savings interest you would have to have £4501 before you would have any tax to pay on the interest.

    You start with a maximum of £5000 starter savings rate band but £1500 is ignored because of the £1500 wages which have been taxed.

    So £3500 is taxed at starter savings rate of 0%.

    And another £1000 is taxed at 0% courtesy of the Personal Savings Allowance rate.

    The final £1 is taxed at the savings basic rate of 20%.

    If you can say (roughly) what your taxable salary for the current year and next year will be along with an estimate of your savings interest each year your tax bill can be estimated.
    • Dazed and confused
    • By Dazed and confused 5th Jan 18, 9:46 PM
    • 2,644 Posts
    • 1,266 Thanks
    Dazed and confused
    Roxy28

    Can you give a example for say someone on £10,000 per year with a PA of £11,500

    And
    Someone on £13,000 with a PA of £11,500.


    Assuming the person hasn't applied for Marriage Allowance and doesn't have other sources of income then they could have the following interest before paying tax,

    £10000 wages/pension
    £7500 interest with no tax to pay
    (£1500 covered by remaining personal allowance, £5000 taxed at starter savings rate (0%) and £1000 taxed at Personal Savings Allowance rate (0%))

    £13500 wages/pension
    £4000 interest with no tax to pay
    (£3000 taxed at starter savings rate (0%) and £1000 taxed at Personal Savings Allowance rate (0%))
    • roxy28
    • By roxy28 6th Jan 18, 12:24 PM
    • 655 Posts
    • 59 Thanks
    roxy28
    Roxy28

    Can you give a example for say someone on £10,000 per year with a PA of £11,500

    And
    Someone on £13,000 with a PA of £11,500.


    Assuming the person hasn't applied for Marriage Allowance and doesn't have other sources of income then they could have the following interest before paying tax,

    £10000 wages/pension
    £7500 interest with no tax to pay
    (£1500 covered by remaining personal allowance, £5000 taxed at starter savings rate (0%) and £1000 taxed at Personal Savings Allowance rate (0%))

    £13500 wages/pension
    £4000 interest with no tax to pay
    (£3000 taxed at starter savings rate (0%) and £1000 taxed at Personal Savings Allowance rate (0%))
    Originally posted by Dazed and confused
    Thanks Dazed and confused thats really helpful,

    No other income in my example and they are as close to the real income within a few pence, so your example is very relevent, and it would take a lot of savings to go anywhere near paying any savings tax from their very modest savings.
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