Question about tax return

[bubbly]

I'm ploughing through my first ever tax return & was getting on ok until reaching the part about 'Other Income: Uk interests & dividends'.

In box 1 you have to fill in your bank/building society interest/amounts which have been taxed already.

My problem is this: I was employed in an office until Nov 30th 2007 and began minding on Dec 3rd 2007. However, my accounts run from 6th April 2007 until 5th April 2008. I was buying equipment in April '07 so started my accounts from then.

Do I fill in box 1 with the taxable interest from Dec 3rd - 5th April (when I began minding) or do I fill it in with the taxable interest from when my accounts began i.e. 6th April 2007 - 5th April 2008?

I should imagine the answer will be from when my accounts began but can someone with experience clarify for me?

Thankies,
Lynne xxx

[sarah707]

That bit refers to your income from your bank accounts.

Probably insulting you, but might be useful for newbies... there are 2 ways to run a bank account - you can either pay tax at source or you can sign a form to say you will have your interest untaxed and put it on your tax return (R85 I think it's called).

So is you signed the form, then you need to go through your bank accounts and tot up the interest you have been given and put the total in the box... if your income - expenses + certain benefits + bank interest is over the tax threshold for the year, you will be taxed on it... if not you won't.

Hope that makes sense :D

[bubbly]

The tax is deducted on the interest BEFORE it's paid into my bank account so do I just ignore box 1 altogether then?

The box is asking for the amount which has been taxed already. It sounds as though I need to write something in there.

Thanks Sarah for helping :)

[sarah707]

If you have any other income which is taxable you have to put the figures in one of the boxes...

... income from bank interest which is not taxed at source (ie. by the bank before you get it) goes in one of the boxes (can't remember which, my form went off last week)...

If you have already paid tax on the money, then you do not put it on your tax return as you do not need to pay tax on it twice!!

If it continues to blur, I'd give them a ring on Tuesday :D

http://search2.hmrc.gov.uk/kbroker/hmrc/contactus/start.jsp

[bubbly]

I phoned the tax office this morning & they said you have to fill in the box but they know not to tax you on it twice.

At least I hope they know! :D