Changes to the way interest is taxed mean more people will have to complete a tax return and pay their bills by 31 January next year, national IFA LEBC Group has said.
The firm said as tax on interest is no longer deduced at 20% by banks and building societies taxpayers need to inform HM Revenue & Customs (HMRC) and pay any tax due on savings interest by the end of January, following the end of the tax year. LEBC said when this change was introduced, the government also introduced a new savings allowance of £1,000 per year for basic rate taxpayers and £500 per year for 40% taxpayers. However, top rate (45%) taxpayers don't get this allowance. LEBC director of public policy Kay Ingram said: "If the interest earned exceeds individual allowances, HMRC...
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