Reporting Savings Interest

I am a non-tax payer and a pensioner and my only income is an occupational pension and interest from two joint accounts belonging to myself and my husband At the end of the tax year I contact hmrc by phone and let them know how much interest is mine, as I understand it the interest is split 50/50. Is it necessary for me to inform hmrc of how much interest I have earned each year or will the banks and or building societies do that. Thank you.

Hi Yvonne Kemp,
That's right - your banks and building societies will automatically inform us of how much interest you earned through your accounts after the tax year ends.
If any tax is owed on these amounts, we will then contact you directly.
Thank you. 

 

Be aware that frozen tax thresholds are likely to bring more individuals on modest incomes into paying tax for the first time. You say you are a pensioner and only have an occupational pension. Do you not have the State Pension? The State Pension is normally paid gross and is the first item to come out of the Personal Tax Allowance that stands at £12570 per annum and has been frozen by the Chancellor until 2028. The State Pension, if paid, is subtracted from the PTA. This reduces your tax free amount, also reduces your tax code and subsequently increases your PAYE on your occupational pension. If you don't have the State pension, then your tax code is unaffected. The tax code is your tax free amount divided by 10. So if you have the State pension, say £9000 per annum, that is subtracted from the PTA (£12570) to leave £3570. This gives you a tax code of 357. You should be getting a P60 notice from your occupational pension provider either late March or early April of each tax year. You need to check what the tax code is, If it's 1257 then you don't get the State pension which is unusual if you are a pensioner of State pension age. If you don't get the State pension because you don't age qualify then you will need to take care in the future as savings interest can pull you into tax. Inflationary increases in State and other pensions may seem good, but if the thresholds don't follow inflation, then you may have to pay tax without realising it.