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Posted Tue, 22 Aug 2023 20:26:52 GMT by E Walsh
Hi hoping some people can help with this, Last year I was expecting a large bonus which didn't materialize this year but will likely in coming year; however I paid a large sum in PAYE overpayment the previous year in expectation of this non-PAYE income. The result was that I got interest on this overpayment and after some research it seem that interest paid by HMRC is no considered income for income tax purposes - hence the interest paid by HMRC on this overpayment is exempt from tax. I wish to confirm this to be the case if anyone can help. My three questions are 1. Can anyone confirm that I do not have to pay income tax on interest paid by HMRC on overpayment of PAYE tax. 2. Is there a limit to the amount of money you can overpay tax by and thereby get interest on that sum. 3. Is there a time limit of how long you can leave overpayment of tax money with HMRC before you risk not getting it back when required. Basically I want to leave with HMRC and prepay my potential future tax liability.
Posted Wed, 30 Aug 2023 10:36:09 GMT by HMRC Admin 20
Hi E Walsh,

The repayment supplement you receive from HMRC is not a taxable income.
HMRC only review the last 4 tax years, if you think you may be due a repayment for a year you should always enquire within 4 years of the
tax year ending to ensure a repayment has been issued if due.

Thank you.
Posted Sat, 02 Mar 2024 15:47:23 GMT by Louise D
Hi I have a full time job and a side hustle that earned me £1200.23 this tax year, how much tax would I have to pay on that amount, considering my main job deducts tax and insurance? I feel I have over payed tax for the side hustle because the calculations haven't taken into account the deductions from my main job. Any ideas? Louise
Posted Wed, 06 Mar 2024 08:46:58 GMT by HMRC Admin 25
Hi Louise D,
If your main full time job is using all your personal allowance £12570 then your full additional income will be taxable.
This will be taxed depending on the tax band you are on.
If you are a basic rate tax payer in England this will be 20%.
You can check the rates  here:
Income Tax rates and allowances for current and previous tax years Updated 15 January 2024
Thank you. 


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