Okcub2008

Hi HMRC Admin 2, I'm sorry but, with respect, that's a completely unacceptable response. I'm not asking you for advice on how much I should pay into my pension scheme, I'm asking you about the mechanics of the personal savings allowance. Please could you confirm whether my understanding of the mechanics is correct based on the examples provided. I realised shortly after posting that I'd made a small error in Example 1, so here are the examples again, this time with a minor correction included. Example 1 Taxable income excluding savings interest: £49,320 Taxable interest from savings : £950 Total taxable income : £50,270 Deduct personal allowance : (£12,570) Taxable income after personal allowance : £37,700 Therefore tax band = basic rate 20% Qualify for PSA of £1,000 PSA utilised = £950 Taxable amount after PSA applied = £36,750 Tax @ 20% = £7,350 Example 2 Taxable income excluding savings interest: £49,321 Taxable interest from savings : £950 Total taxable income : £50,271 Deduct personal allowance : (£12,570) Taxable income after personal allowance : £37,701 Therefore tax band = basic rate 40% Qualify for PSA of £500 PSA Utilised : £500 Taxable amount after PSA = £37,201 Tax @ 20% = £7,440.20 Please confirm whether these examples show the correct determination of the personal savings allowance. Thank you

Hello, I'm trying to calculate the appropriate amount to contribute to my personal pension in 23/24 in order to avoid slipping from the £1,000 personal savings allowance (PSA) afforded to basic rate tax payers, to the £500 allowance given to higher rate payers. The guidance on the PSA provided on the HMRC site states that "to work out your tax band, add all the interest you’ve received to your other income". For the purpose of avoiding ambiguity I'd like to provide a couple of examples to test whether my understanding is correct. Example 1 Taxable income excluding savings interest: £49,320 Taxable interest from savings : £950 Total taxable income : £50,270 Deduct personal allowance : (£12,570) Taxable income after personal allowance : £37,700 Therefore tax band = basic rate 20% Qualify for PSA of £1,000 Taxable amount after PSA = £36,700 Tax @ 20% = £7,340 Example 2 Taxable income excluding savings interest: £49,321 Taxable interest from savings : £950 Total taxable income : £50,271 Deduct personal allowance : (£12,570) Taxable income after personal allowance : £37,701 Therefore tax band = basic rate 40% Qualify for PSA of £500 Taxable amount after PSA = £37,201 Tax @ 20% = £7,440.20 Is my understanding here correct? Thanks!