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UK Window Cleaning Forum => Window Cleaning Forum => Topic started by: wightsurf on December 06, 2013, 01:25:44 pm

Title: Tax on money in the bank
Post by: wightsurf on December 06, 2013, 01:25:44 pm

looking at my business account I notice that the interest was taxed . So my question is
how is this worked out as I have paid tax do I pay more tax ???

Title: Re: Tax on money in the bank
Post by: JNESTIE on December 06, 2013, 01:36:58 pm

Hi

The bank will automatically assume you are a tax payer and take 20% basic rate tax off you at source.  You need to include the interest paid and the tax taken off in your tax returns.

Title: Re: Tax on money in the bank
Post by: andyM on December 06, 2013, 03:34:00 pm

You're not paying tax on your money in the account.
You are paying tax on the interest that the money in the account has earned.

Title: Re: Tax on money in the bank
Post by: wightsurf on December 06, 2013, 03:49:07 pm

Yes that's right but don't I have to declare the money (interest) and if so how do I go about the tax on the interest.

Title: Re: Tax on money in the bank
Post by: Pro-Smart on December 06, 2013, 03:52:51 pm

Yes you do have to declare the interest earned - it's a question on your Self Assessment form. However, they phrase it so the 20% already deducted is taken into account. If you are a higher rate taxpayer then more tax will be deducted by your SA calculation.

Title: Re: Tax on money in the bank
Post by: wightsurf on December 06, 2013, 04:03:42 pm

Thanks that what I needed to hear.