Reporting savings interest

Hi, I'm a resident in the UK and have a PSA of 500 pounds per year depending on my income band. I'll probably go over my allowance in this tax year with the savings account (in a well-known UK bank) interests I'll get. Hi - I am in full-time employment and have never needed to complete a tax return for any reason. With interest rates increasing I may need to pay tax on interest from some of my savings for the first time. Am I right in thinking that my various banks will tell HMRC the amount of saving interest I've earned in the current tax year and HMRC will automatically update my tax code? ie I dont need to do anything? Is this correct? Thanks

Hi,

Yes, the banks will notify HMRC of the annual interest received and your records will be updated based on this.

Any charges will be notified by way of a calculation and tax code change.

Thank you.

If I am a full time mum and I know my saving interest will not exceed the allowance, do I need to submit the tax return form?

Hi,

No, you do not need to submit a tax return.

Thank you.

Hello - I have savings accounts that will pay over the £1000 interest limit. When I spoke to HMRC a few months ago they said I should phone up when the interest is paid to update my records. I don't do a Self Assessment Tax return and am retired. Do I need to ring or as previous messages have said the banks will let HMRC know the interest I've been paid. Many thanks for your help.

Hi, I have a savings account which pays yearly interest on 28 September, on the anniversary of the account opening in 2022. When do I declare the interest? I.E. Is it declared in 23-24 (because that is when the interest is paid) or will I be declaring the amount that has been earnt but not paid?

Hello - I just wanted to confirm that one has an allowance of £1,000 per tax year on interest income? It's only above that amount that we have to pay tax? thanks

Hello - Two questions; 1- I've just recently retired and invested my pension lump sum in various UK savings accounts. Do I need to tell HMRC this or will the providers send the the relevant info for calculating my tax code? 2 - Some are joint with my spouse, so will HMRC take this into account?

Hi, I have several fixed rate bonds (2-5 year terms). In most cases, the monthly interest is paid into the bond, where it compounds, and is not accessible until maturity. Should I be reporting the interest and paying tax on it annually, or only when the account matures and the money is accessible?

Hi Ferdie,

HMRC will be notified by the financial institution after the tax year has ended and we would update your records accordingly.

You can contact us by telephone or in writing before this is done.

However, you would need to provide the name of the financial institution, account numbers, share of interest and the interest amount.

Income Tax: general enquiries

Thank you. 

Hi countduff Duff,

The date that the interest is paid, is used to determine the tax year in which it is declared.

 If the interest is paid 28 September 2023, then it is taxable in the 2023 to 2024 tax year.

Thank you. 

Hi anderssummers,

Please see:

Tax on savings interest

Thank you. 
 

Hi, Is there any way of seeing the interest breakdown used by HMRC for my tax calculation ? I checked on HMRC whether I needed to use self assessment last year (2021/22) - the check said no but I got hit with a penalty of not submitting. I just want to make sure my tax affairs are up to date and so, to be safe, will use 2022/23 self assessment even though website says not required.

Hi Nogglebone

You do not need to notify HMRC.

Once any interest is generated, the providers will notify HMRC of the amounts and any split for the income.

Thank you. 

Hi chris fletcher,

As you cannot access the funds then only when the account matures.

Thank you.

Hi - I'm new to this forum, so how do I ask a question, as this is the post a reply box. Thanks

Hi Fulflood whiteside,

You will need to query the breakdown with our Income Tax team.

Income Tax: general enquiries

Thank you.

I am completing my 22/23 self assessment, and by my calculations I will creep into higher rate tax. I have determined this by adding my income and gross savings interest together which exceeds £50,270 by a few hundred pounds. Therefore my personal tax allowance on interest is £500. Supposing my total gross interest is £1,700, should I enter £1,700 on the self assessment or £1,200?

I have a joint fixed rate one year bond with my spouse that matures in late 2023. We do not currently undertake the self assessment process but the increase in interest rates may require use to pay tax. Question: Do we both need to submit a self assessment to HMRC in order to pay any tax? 1. Yes you both need to complete a self assessment. 2. By what date do we need to submit our self assessments to HMRC 2. No HMRC contact us both with either a bill or change in tax codes. Thank you Thank you

I have multi saving accounts and lost track on the interest/ reward earned. As stated, the banks will notifity HMRC anyway, when would the record be updated so I can populate the rest of the SA for submission.