Reporting savings interest

Hi, I have fixed savings account with reputed high street bank & it will be matured after 1 year. i am full time employed & don't need to do self-assessment. The interest earned will be more than £1000. do i need to report myself to HMRC or bank will inform them. Thanks in advance.

Hi, I got the answer regarding to the fact that a foreigner (non UK tax resident) with saving interest earned from bank(s) in UK less than GBP10K in a tax year NO NEED to file tax return. Meanwhile I just saw one, seemingly a UK tax resident, needs to "register" for self assessment to report the foreign interest regardless of the amount received (mentioned by HMRC Admin 20 in a very recent post) THEREFORE I would like to clarify whether such requirement to register for self assessment is also applicable to foreigner (non UK tax resident) earning saving interest - less than GBP10K saving interest from bank(s) in UK in a tax year although there is no need to file a tax return anyway?

Hi kec,
If it is only UK interest that you receive and under £10,000 then no tax return is required. Foreign income needs to be declared.
Thank you.

Hi, I have a question regarding interest paid, on cash balances held in a UK share dealing nominee account. Can this be considered as savings income, even though it is not specifically referenced in https://www.gov.uk/apply-tax-free-interest-on-savings ? NB. This 'client money', as defined by the FCA, is deposited in multiple banks, covered by the FSCS deposit protection scheme and when Bank of England base rates rose rapidly, in late 2022, my account then started paying interest on cash deposits. Because this is essentially a return of interest paid by the banks to the client, via the nominee, I assume it falls within the intended scope of the legislation?

HRMC Admin 32 Thx for your reply. As I mentioned before, I am foreigner (i.e. non UK tax resident) therefore it is believed I don't need to declare foreign income. The issue is that I have saving interest, below GBP10K in a tax year, earned in my accounts with bank in UK. I was told by your colleague that no tax return required under this scenario. My question is any registration for self assessment required or not ?

Hi kec
As you are not resident in the UK, savings interest is taxable as disregarded income.
You can see guidance here: SAIM1170 - Savings and investment income: non-residents
The effect is that the liability of a non-UK resident in respect of savings and investment income is limited to the Income Tax deducted from it or treated as deducted or paid in respect of it. No tax return is required and there is no need to register for a tax return.
Thank you.

Hello, I earned around £1500 (could be slightly more or less) in interest via a savings account for tax year 2022-23, so would have needed to pay tax on the £500 over the £1000 limit. I'm employed by a company ,not self-employed, so I do not complete a yearly self-assessment form. My understanding is that the ta I owed tax would've automatically been collected in the following way: The savings account provider would have informed HMRC about the additional interest earned, and then HMRC would've changed my tax code. My questions: 1. Is the above assumption correct? 2. If so, then I don't remember being contacted by HMRC about the tax code change. Should I have been contacted, and how? I will check my tax code to see if I can work out if it was changed to accomodate the extra tax owed.

Update to my message above: The end of the financial year was 4 months ago, my tax code has not changed, and I've received no contact from HMRC about it.

Hi DiCanio564gf,
Banks will notify HMRC of the interest earned in the year.
For tax year 22 to 23 this will not have been finalised yet for a tax calculation and change in tax code to be issued.
Thank you.

@DiCanio564gf Day You are on the right lines but timeframe is a bit out. Banks and building societies have until 30 June after the tax year ends to notify HMRC of the interest so it's probably a bit early to get a calculation showing any tax owed. And any tax owed for 2022-23 will normally be collected via your 2024-25 tax code, starting next April. Your current (2023-24) tax code may also be amended later this year to reflect the latest interest information available but that will only be to collect any extra tax due for 2023-24, not tax owed for the previous tax year.

Hi RobX,
It's not clear whether the account in question is for an individual nominee account (designated account) or a pooled nominee account (undesignated account).
The principles outlined at SAIM2065 should be extended to apply to the account that you are referring to.
The guidance advises that interest arising on designated accounts is taxable, whereas payments received from undesignated accounts are treated as savings income within ITA07/S18. SAIM2065 - Interest: Solicitors' client accounts Designated and undesignated client accounts
Thank you.
 

Thanks HMRC Admin 20, for the clarification. I have since requested this information from my online share trading account provider and await their response.

Dear Team, I am a high rate tax payer in full time employment. My savings interest will exceed £500. I have never needed to complete a self assessment form in the past. Please can you let me know if I need to notify HMRC of the interest and if YES, please let me know how I should do this? Could you also please confirm whether the tax on interest will be automatically collected by HMRC from my salary (by changing my tax code ) once my bank informs HMRC? Please let me know. Thanks in Advance. Jithin

Hi JithinJose2409,
If you meet the criteria for completing a Self Assessment, then you do need to include this on the return.
Once HMRC are informed of interest by banks we do update your tax code accordingly.
Check if you need to send a Self Assessment tax return
Thank you. 

Hi all, I have just checked my online account, and found that there is a deduction of £700 on my tax free amount for the current tax year. I did not file a self assessment last year, but had interest above £1000. How is this all being calculated ? I was surprised to see this figure today.

Hi Findingout,
If your account doesn't show a breakdown, you will need to contact our helpline to query this:
Income Tax: general enquiries
Thank you. 

I completed a self assessment tax return for 2022/23 for the first time and I entered interest on savings which was below my PSA. Should I have done this as it seems I have been taxed on that interest.

Hi JaseC
The amount should be included, if you review the calculation it will show an amount taxable at 0%.
Thank you.

I have saving interest from several bank accounts, please advise if I wait for HRMC to send me income declaration or I proactively submit to them. Thanks

Hi Kc

The amounts will be reported to HMRC by the financial institution. You only need to report them yourself if you meet the criteria for Self-Assessment. See link: Tax on savings interest    . Thank you.