mason
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Post by mason on Jan 30, 2017 18:41:36 GMT
I didn't think HMRC received information on P2P earnings?? They do. Which is why questions have been asked on a few of the platform specific boards about exactly how those platforms calculate the figure that they send to HMRC (so that lenders can submit a figure that doesn't conflict with it).
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james
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Post by james on Jan 30, 2017 19:36:39 GMT
They receive it but don't yet use it for automatic tax calculations. Some press coverage suggested maybe in a couple of years. Makes sense given the relative immaturity of P2P provider systems and low priority due to the total amount involved.
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awk
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Post by awk on Jan 31, 2017 3:55:50 GMT
Along with other Financial institutions, all P2P platforms provide interest data to HRMC which ends up in the CONNECT database.
HRMC currently use this to sanity check your SA returns and 'prompt' you to review your submission if there is a variance.
My understanding is that in a couple of years time, CONNECT will push all reported interest, capital gains, income, etc into your online SA form which will eventually be close to a realtime statement.
Beware
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Post by dan1 on Mar 25, 2017 21:03:50 GMT
Quick Tax Related Query If I earn less than my personal savings allowance of £500 in interest from P2P do I still need to declare this to HMRC despite not owing tax on it ?? Also looking forward, interest earned in P2P IFISA, does this need declared to HMRC ?? Try this HMRC calculator: www.gov.uk/check-if-you-need-a-tax-returnI'm trying to work out whether I need to register for self-assessment. I'm currently PAYE but this tax year (16/17) I'll have earned > £2.5k interest from savings and P2P so I assume I'll need to register for self-assessment? I'm confused because of these two statements on the HMRC site ( www.gov.uk/self-assessment-tax-returns/who-must-send-a-tax-return) You’ll need to send a tax return if, in the last tax year:
- you got £2,500 or more in untaxed income, for example from renting out a property or savings and investments - contact the helpline if it was less than £2,500
- your savings or investment income was £10,000 or more before tax
I thought all savings and investment income was untaxed so why have one threshold at £2.5k and another at £10k?
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ilmoro
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'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
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Post by ilmoro on Mar 25, 2017 22:07:41 GMT
I'm trying to work out whether I need to register for self-assessment. I'm currently PAYE but this tax year (16/17) I'll have earned > £2.5k interest from savings and P2P so I assume I'll need to register for self-assessment? I'm confused because of these two statements on the HMRC site ( www.gov.uk/self-assessment-tax-returns/who-must-send-a-tax-return) You’ll need to send a tax return if, in the last tax year:
- you got £2,500 or more in untaxed income, for example from renting out a property or savings and investments - contact the helpline if it was less than £2,500
- your savings or investment income was £10,000 or more before tax
I thought all savings and investment income was untaxed so why have one threshold at £2.5k and another at £10k? You do need to do SA, I checked with HMRC recently, 2.5k was the sum they referenced.
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Post by dan1 on Mar 25, 2017 22:09:07 GMT
I'm trying to work out whether I need to register for self-assessment. I'm currently PAYE but this tax year (16/17) I'll have earned > £2.5k interest from savings and P2P so I assume I'll need to register for self-assessment? I'm confused because of these two statements on the HMRC site ( www.gov.uk/self-assessment-tax-returns/who-must-send-a-tax-return) You’ll need to send a tax return if, in the last tax year:
- you got £2,500 or more in untaxed income, for example from renting out a property or savings and investments - contact the helpline if it was less than £2,500
- your savings or investment income was £10,000 or more before tax
I thought all savings and investment income was untaxed so why have one threshold at £2.5k and another at £10k? You do need to do SA, I checked with HMRC recently, 2.5k was the sum they referenced. Thank you. Oh joy
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mason
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Post by mason on Mar 26, 2017 6:49:29 GMT
You do need to do SA, I checked with HMRC recently, 2.5k was the sum they referenced. Thank you. Oh joy Actually, I don't think you will need to do SA. If you use the calculator linked by Liz above and say yes to having more than £2.5k of untaxed income, it will tell you you need to self assess, but underneath it states: 2016 to 2017 tax yearYou won’t need to fill in a tax return for the 2016 to 2017 tax year if you have less than: £10,000 of income from savings £10,000 of income from dividends ( Link) I fit into the category of having >£2,500 in untaxed interest, but I'm still well below the £10,000 figure, so won't need to self-assess.
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fasty
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Post by fasty on Mar 26, 2017 7:43:34 GMT
Actually, I don't think you will need to do SA. If you use the calculator linked by Liz above and say yes to having more than £2.5k of untaxed income, it will tell you you need to self assess, but underneath it states: 2016 to 2017 tax yearYou won’t need to fill in a tax return for the 2016 to 2017 tax year if you have less than: £10,000 of income from savings £10,000 of income from dividends ( Link) I fit into the category of having >£2,500 in untaxed interest, but I'm still well below the £10,000 figure, so won't need to self-assess. That's confusing; I believe they are referring to £10000 of TAXED savings so not P2P?
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Post by dan1 on Mar 26, 2017 7:54:36 GMT
Actually, I don't think you will need to do SA. If you use the calculator linked by Liz above and say yes to having more than £2.5k of untaxed income, it will tell you you need to self assess, but underneath it states: 2016 to 2017 tax yearYou won’t need to fill in a tax return for the 2016 to 2017 tax year if you have less than: £10,000 of income from savings £10,000 of income from dividends ( Link) I fit into the category of having >£2,500 in untaxed interest, but I'm still well below the £10,000 figure, so won't need to self-assess. That's confusing; I believe they are referring to £10000 of TAXED savings so not P2P? It all depends on the definition of whether the interest is classed as taxed/untaxed. I was under the impression that since the introduction of the personal savings allowance no interest is taxed at source.
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mason
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Post by mason on Mar 26, 2017 8:31:13 GMT
That's confusing; I believe they are referring to £10000 of TAXED savings so not P2P? All savings income is untaxed in the 2016/17 tax year. There is no such thing as taxed savings. In any case, I'll not be registering for SA and I'll be using that webpage as my reason for not doing so. Based on past experience, if I make a declaration to HMRC in early April, I'll receive my tax calculation in May (which should show a net refund is due because of my contributions to a VCT), so I'll still have plenty of time to go down the SA route if they instead tell me that's what I need to do.
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hazellend
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Post by hazellend on Mar 26, 2017 8:40:57 GMT
Along with other Financial institutions, all P2P platforms provide interest data to HRMC which ends up in the CONNECT database. HRMC currently use this to sanity check your SA returns and 'prompt' you to review your submission if there is a variance. My understanding is that in a couple of years time, CONNECT will push all reported interest, capital gains, income, etc into your online SA form which will eventually be close to a realtime statement. Beware Hi Awk. Are you saying if somebody under reports their P2P income liable to tax, there will be no punishment as long as the respond to the prompt? When does the prompt occur? Is it immediately at the time of submitting your self assessment?
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awk
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Post by awk on Mar 26, 2017 9:56:38 GMT
Along with other Financial institutions, all P2P platforms provide interest data to HRMC which ends up in the CONNECT database. HRMC currently use this to sanity check your SA returns and 'prompt' you to review your submission if there is a variance. My understanding is that in a couple of years time, CONNECT will push all reported interest, capital gains, income, etc into your online SA form which will eventually be close to a realtime statement. Beware Hi Awk. Are you saying if somebody under reports their P2P income liable to tax, there will be no punishment as long as the respond to the prompt? When does the prompt occur? Is it immediately at the time of submitting your self assessment? , Some 'prompt' letters were sent out in Dec 2016 relating to the 2015/16 tax year. However, I'm guessing it was a bit of an experiment to see the reaction - evidently, they didn't say what you might want to reconsider! There's nothing to say that this will be the policy this year, but it does show that Big Brother is watching you
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pikestaff
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Post by pikestaff on Mar 26, 2017 10:25:17 GMT
Along with other Financial institutions, all P2P platforms provide interest data to HRMC which ends up in the CONNECT database. HRMC currently use this to sanity check your SA returns and 'prompt' you to review your submission if there is a variance. My understanding is that in a couple of years time, CONNECT will push all reported interest, capital gains, income, etc into your online SA form which will eventually be close to a realtime statement. Beware Hi Awk. Are you saying if somebody under reports their P2P income liable to tax, there will be no punishment as long as the respond to the prompt? When does the prompt occur? Is it immediately at the time of submitting your self assessment? HMRC are not that efficient, yet. "Prompt" means write to you. A few years ago I got a letter some time after submitting my return, politely enquiring if I'd left any interest out. They didn't say how much. In my case I was right to exclude it because the interest was on investments which I held as a trustee, and I'd correctly included the interest on the trust tax return. I gave them chapter and verse and they were happy. They warned me that I might be asked again, which led me to think that at that time they were just doing spot checks. With regard to punishment, if the error only only comes to light after they prompt you, the standard penalties are: - for careless mistakes 15-30% of the overdue tax (but may be suspended if you promise to be good in future) - for deliberate errors (intentionally sending incorrect information) 35-70% of the overdue tax - for deliberate and concealed errors (intentionally sending incorrect information and taking steps to hide the error) 50-100% of the overdue tax. See new-penalties.pdf (264.4 KB). There is usually no penalty if you have taken "reasonable care", but I don't think that would apply here. The knowing omission of p2p interest would be a deliberate error but not, I think, "deliberate and concealed". For deliberate errors there there is also the risk that you might be singled out for prosecution, put on HMRC's "managing serious defaulters" regime, or subjected to a tax investigation. But this is unlikely to happen unless HMRC think they will benefit. Penalties for deliberate errors were up 38% for 2015-16, and up almost six-fold over the last four tax years. www.cchdaily.co.uk/hmrc-penalties-deliberate-errors-tax-returns-rise-38
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littonowl
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Post by littonowl on Mar 26, 2017 10:33:21 GMT
Actually, I don't think you will need to do SA. If you use the calculator linked by Liz above and say yes to having more than £2.5k of untaxed income, it will tell you you need to self assess, but underneath it states: 2016 to 2017 tax yearYou won’t need to fill in a tax return for the 2016 to 2017 tax year if you have less than: £10,000 of income from savings £10,000 of income from dividends ( Link) I fit into the category of having >£2,500 in untaxed interest, but I'm still well below the £10,000 figure, so won't need to self-assess. In a similar boat @mason, and that was my understanding too. Also not currently intending to complete a SA.
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bigfoot12
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Post by bigfoot12 on Mar 26, 2017 11:23:25 GMT
I don't think that completing a SA tax return is very arduous. The thing I used to hate was trying to find all the bits of paper I needed. This has become much easier as now most of my 'bits of paper' are online. Even so for the last 10 or more years I have had an A4 envelope on my shelf and mail I get sent which I will need for my return is put straight into that. Even employment income was pre filled in this year, adding savings income took about 10 minutes.
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