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  • FIRST POST
    • RG2015
    • By RG2015 7th Apr 18, 4:36 PM
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    RG2015
    Bank interest on personal tax account online
    • #1
    • 7th Apr 18, 4:36 PM
    Bank interest on personal tax account online 7th Apr 18 at 4:36 PM
    HMRC have the following information on their website.

    For sole bank account holders, not in Self-Assessment, 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.

    Does anyone know if this information be shown online on the HMRC personal tax account pages even if it does not result in a tax liability in any given year?
Page 2
    • AnotherJoe
    • By AnotherJoe 10th Apr 18, 1:49 PM
    • 9,364 Posts
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    AnotherJoe
    Can you get that in writing?
    • newatc
    • By newatc 10th Apr 18, 2:02 PM
    • 230 Posts
    • 268 Thanks
    newatc
    Thanks AirlieBird,

    I have just phoned HMRC to report the interest and they told me that I have no obligation to report interest if it is below my PSA.

    I asked if I could get this in writing and they said that if I wrote to them they would confirm it in writing.
    Originally posted by RG2015
    This is common sense. I have previously contacted HMRC and their answer was, im my opinion, ambiguous but I came away concluding that they were saying "Don't rely on the banks, if you think you owe us tax then the onus is on you to tell us". Your message is more clear but seems consistent with my received message.
    • RG2015
    • By RG2015 10th Apr 18, 2:38 PM
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    RG2015
    Can you get that in writing?
    Originally posted by AnotherJoe
    Ha!

    Thatís exactly how I transcribed my recording of the telephone conversation.

    If only!
    • polymaff
    • By polymaff 10th Apr 18, 3:10 PM
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    polymaff
    If you have savings tax owed from 2016/17 and 2017/18 but are quite happy to wait because HMRC say there is no need to report this to them and they will find out from you banks, will they eventually be able to fine you for not telling them years down the track?
    Originally posted by Tom99
    Yes. HMRC have all of the power but none of the responsibility ("the prerogative of the harlot throughout the ages." - as Stanley Baldwin put it).

    Accurate and complete data plus an understanding of the applicable legislation - and some ability at arithmetic - have never been more necessary.

    Fortunately, you can provide some defence of your position by choosing to use HMRC's self-assessment process. As previously recommended.
    Last edited by polymaff; 10-04-2018 at 3:13 PM.
    • dori2o
    • By dori2o 10th Apr 18, 8:00 PM
    • 7,598 Posts
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    dori2o
    No its not. Full data has been provided by the banks for decades. Perhaps you mean this is the first year data has been fully processed and used in tax calculations. Joint accounts are reported but, as you say, are not used.

    RG: you need to contact HMRC to report your interest if you are a joint account holder



    https://www.gov.uk/government/publications/personal-savings-allowance-factsheet/personal-savings-allowance
    Originally posted by AirlieBird
    If you want to be technical then yes, this is the first year all single account details will be posted directly onto each individuals record and not just sit in a data file.

    This however is on the assumption that the bank holds correct current personal details, i.e name, address, date of birth, and in some cases where the bank has requested it, your NI number.

    The information will then be used in any further calculations and new tax codes will be generated assuming a similar amount of interest in current and future years to that last posted by the bank, unless the taxpayer has provided alternate details.
    To equate judgement and wisdom with occupation is at best . . . insulting.
    • dori2o
    • By dori2o 10th Apr 18, 8:03 PM
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    dori2o
    Mostly answered by the very text you highlighted.

    The rest of your post falls into the category of "When did you stop beating your wife?"
    Originally posted by polymaff
    At no point do HMRC offer a seal of approval with Self Assessment.
    To equate judgement and wisdom with occupation is at best . . . insulting.
    • RG2015
    • By RG2015 5th May 18, 10:09 PM
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    RG2015
    Update
    Thanks AirlieBird,

    I have just phoned HMRC to report the interest and they told me that I have no obligation to report interest if it is below my PSA.

    I asked if I could get this in writing and they said that if I wrote to them they would confirm it in writing.
    Originally posted by RG2015
    I wrote to HMRC asking them to confirm that I did not need to report my interest received if it is below my PSA. I also told them that to calculate my interest received, I had only included 50% of the interest received on my joint accounts.

    I have now received a reply from HMRC.

    In regards to the untaxed income you received, you can contact us to report the gross interest, even if the total interest received was below the personal savings allowance of £1,000.

    However, even if you don't report the interest, the banks and building societies still continue to report details of the gross interest received.

    If you do wish to report any details of untaxed interest, please don't hesitate to contact us.


    Their response is not particularly clear but it does not say that I should report my interest received.
    • Dazed and confused
    • By Dazed and confused 5th May 18, 11:15 PM
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    Dazed and confused
    Useful update but I fear it is really only relevant to you.

    Tax is so complicated now that there is no one size fits all answer anymore.

    Lower earners cannot get the Personal Savings Allowance

    Very very high earners cannot get the Personal Savings Allowance

    Very high earners can get it but will still have extra tax to pay even if their interest is only £500

    High earners can get it but could have extra High Income Child Benefit Charge to pay

    Elderly married pensioners with half decent annual income could have extra tax to pay even if their savings income is less than £1000

    And it's probably even worse if you are a Scottish taxpayer
    • RG2015
    • By RG2015 6th May 18, 8:29 AM
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    RG2015
    Useful update but I fear it is really only relevant to you.
    Tax is so complicated now that there is no one size fits all answer anymore.
    Originally posted by Dazed and confused
    Thanks for your reply although I asked a simple question and thought that I might get a simple answer.

    My tax is not complicated. I am a basic rate taxpayer with a private pension, MAT and annual interest received under £1,000. My only concern is that I have to deduct 50% of the interest received on my joint accounts to bring it down to less than £1,000.
    Last edited by RG2015; 06-05-2018 at 8:32 AM.
    • polymaff
    • By polymaff 6th May 18, 9:25 AM
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    polymaff
    The simple answer is to opt in to Self Assessment. If your affairs are simple then SA is simple.

    Whatever your affairs are, making your statement directly to HMRC via SA puts you in the best position should a third party's data be faulty.

    And at least one savings provider is currently reporting the wrong data to HMRC.
    • Dazed and confused
    • By Dazed and confused 6th May 18, 10:23 AM
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    Dazed and confused
    My tax is not complicated. I am a basic rate taxpayer with a private pension, MAT and annual interest received under £1,000

    In this situation it is entirely possible, quite likely even a lot might say, that you wouldn't be able to benefit from the Personal Savings Allowance rate band so the £1,000 figure is irrelevant.

    What would be relevant is whether you have any additional tax to pay overall.

    Also, although ultimately it probably won't make any different I personally think this is an odd way of going about things,

    My only concern is that I have to deduct 50% of the interest received on my joint accounts to bring it down to less than £1,000

    If you only added the interest which is applicable to you then there would be no need to deduct anything. Just seems an unusual way of calculating things.
    Last edited by Dazed and confused; 06-05-2018 at 10:26 AM.
    • RG2015
    • By RG2015 6th May 18, 11:01 AM
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    RG2015
    And at least one savings provider is currently reporting the wrong data to HMRC.
    Originally posted by polymaff
    Which one?
    • RG2015
    • By RG2015 6th May 18, 11:19 AM
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    • 708 Thanks
    RG2015
    My tax is not complicated. I am a basic rate taxpayer with a private pension, MAT and annual interest received under £1,000

    In this situation it is entirely possible, quite likely even a lot might say, that you wouldn't be able to benefit from the Personal Savings Allowance rate band so the £1,000 figure is irrelevant.

    What would be relevant is whether you have any additional tax to pay overall.

    Also, although ultimately it probably won't make any different I personally think this is an odd way of going about things,

    My only concern is that I have to deduct 50% of the interest received on my joint accounts to bring it down to less than £1,000

    If you only added the interest which is applicable to you then there would be no need to deduct anything. Just seems an unusual way of calculating things.
    Originally posted by Dazed and confused
    Thanks for your reply and I am genuinely trying to understand the points you are making but I am struggling.

    First, can you suggest a possible way in which the £1,000 PSA is irrelevant for me and what may cause me to have any additional income to pay?

    Second, the annual summary for my joint account states that the gross interest paid from 06/04/2016 to 05/04/2017 is £457.25. Surely my only option is to deduct half of this figure to come to my individual interest received.

    I accept that you may find my approach odd and unusual but I would appreciate it if you could explain why you have come to this conclusion?
    • Dazed and confused
    • By Dazed and confused 6th May 18, 11:29 AM
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    Dazed and confused
    As a MAT recipient you are clearly a "young" pensioner. You might for example have the following income.

    Private pension £8000
    State Pension. £6000
    Savings interest £900
    You will pay basic rate tax on some of your pension income but because it is relatively small, from a tax perspective, you have some of the £5000 starter savings rate band available so your interest will be taxed at 0% by virtue of this.

    In this situation you simply don't have enough income to be able to use the Personal Savings Allowance. You're not any worse off but it isn't relevant to a lot of people.

    An older pensioner may get the Married Couple's Allowance and have more income,

    Private pension £24000
    State pension. £6000
    Savings interest £900

    In this situation the Personal Savings Allowance rate band is applicable (the pension income amounts mean the starter savings rate is not available) and means no tax is payable on the interest but the amount of Married Couple's Allowance due is income based so the £900 of taxable savings interest will reduce the Married Couple's Allowance by £450 which will add £45 to the overall tax bill.
    NB. Married Couple's Allowance is much larger than MAT but tax relief is given at 10% instead of the 20% used for MAT.
    Last edited by Dazed and confused; 06-05-2018 at 12:04 PM.
    • polymaff
    • By polymaff 6th May 18, 11:45 AM
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    polymaff
    which one?
    Originally posted by rg2015
    ns&i ..........
    • RG2015
    • By RG2015 6th May 18, 11:50 AM
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    • 708 Thanks
    RG2015
    An older pensioner may get the Married Couples Allowance and have more income,

    Private pension £24000
    Originally posted by Dazed and confused
    Why do you suggest a private pension of £24,000? As long as the total income from all sources is under the higher rate threshold of £46,350 then the PSA of £1,000 remains relevant for determining the income tax liability.
    • polymaff
    • By polymaff 6th May 18, 11:51 AM
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    • 904 Thanks
    polymaff
    Second, the annual summary for my joint account states that the gross interest paid from 06/04/2016 to 05/04/2017 is £457.25. Surely my only option is to deduct half of this figure to come to my individual interest received.
    Originally posted by RG2015
    If those are the dates you mean, then your tax return is overdue.

    HMRC won't argue with a 50/50 split but you can report any split - so long as you can justify it in terms of how the account was funded.

    By the way, don't use unique / faulty terminology. It'll only confuse everyone - including yourself. "deduct" is the wrong word. What is one party's interest was never the others. The word is "split"

    IMHO, you really need the discipline of completing SA.
    • RG2015
    • By RG2015 6th May 18, 11:56 AM
    • 1,211 Posts
    • 708 Thanks
    RG2015
    ns&i ..........
    Originally posted by polymaff
    Thank you for this but I have just searched via Google and couldn't find anything. Do you have any links?
    • Dazed and confused
    • By Dazed and confused 6th May 18, 12:05 PM
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    • 1,224 Thanks
    Dazed and confused
    Why do you suggest a private pension of £24,000?

    I submitted the post incomplete sorry - now updated to fill in the additional information!

    As long as the total income from all sources is under the higher rate threshold of £46,350 then the PSA of £1,000 remains relevant for determining the income tax liability.

    We'll have to agree to disagree on this. The Personal Savings Allowance rate band simply isn't relevant to lower income individuals. They are not losing out because of this but if you don't have sufficient income then the fact is you cannot make use of the PSA.
    Last edited by Dazed and confused; 06-05-2018 at 12:08 PM.
    • polymaff
    • By polymaff 6th May 18, 12:08 PM
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    • 904 Thanks
    polymaff
    Thank you for this but I have just searched via Google and couldn't find anything. Do you have any links?
    Originally posted by RG2015
    .

    You won't - until the media, MSE-included, catches up with my posts on MSE.
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