tax return confusion - is it dividents or withdrawals that need to be declared?

[CatAndHisKit]

Would be very grateful for advice on this. I'm doing self assessment for the 1st time, and only need to cover a few months in the 2017-18 year. That's easy enough but I've come across 'investments' section and not sure what to do there.

I've withdrawn a couple of thousand from my investment bond in that period (had it a while and hardly anything remains now but it still produces a good return on what little remains, in percentage). It's taxed at source but after reading online advice, it's unclear whether to declare actual withdrawal amount or the official divident (and tax taken at source?) which is a bit higher than the amount withdrawn - or even if it was lower.

From what I've read online, withdrawals aer not taxed at the time but only when the bond is closed/matures, if within the allowed amount, so is it still neccessary to declare at all if you know it's not goijg to be taxed AND that it doesn't take you over any thresholds in terns of your rate of tax?

Thanks!

ah and also the MOney Expert site says that you needto declare the amount stated on 'divident vouchers' that also states tax deducted, I don't receive any vouchers , just a statement of units and how much was withdrawn in that year.

Is it cash or an investment bond

If investment was it partial or whole segments withdrawal

investnend bond, partial 'across the board' as they term it.

-ment!

You have to do the tax return for a full tax year not "a few months" - ALL your income, dividends, etc need to be declared for the full year.

Re your investment, you need to look at the annual statements they provide - there should be a list of dividends and the explanatory notes usually explain what needs to be declared.

thanks, Badbadbunny. The reason it's few months is that the business was only registered in Jan, and that's my sole income for that year apart from the withdrawal from the bond.

I get statements which state there was no taxable event so nothing about having to declare any of it. The issue is I ve misplaces the previous year's statement so can't even find that. But from previous ones, they don't state how much tax was deducted which some advice online mentions. I could phone them thoug not too keen.
CAn I just declare what I've withdrawn?

You can phone your investment bond provider and ask them to send you a tax statement.

With an an investment bond you are permitted to withdraw up to 5% of the original amount invested each year for 20 years without any tax to pay as it is deemed to be return of capital. If you don't use the full 5% in any year it is rolled forward.

If you make a withdrawal above the 5% (or the rolled up amount accrued) this is a chargeable event and a calculation for capital gains tax will be made. This would need to be declared on your tax assessment, although you may not actually have any CGT to pay if it falls within your CGT allowance.

The reason it's few months is that the business was only registered in Jan,

The tax return is still for the full year so you'd have to include dividends etc from the bond for the earlier part of the year too.

Bad I only withdraw once a year.

Sunseed yes I'm familiar with these rules as that's the case with my bond too. It was only once a year and well below 5% - you mention that it needs to be declared if above 5%, so what about if it's below?
I was hoping not, precisely because it's well below, and you seem to imply that? otohh probably nothing to lose by declaring as they won't charge (and would also see the general pictur)..

also as I was asking in the title, is it the actual withdrawal sum they'd want to know about or the dividents per se (whether that's higher or lower than withdrawal sum)?

Dividends, or growth within the bond, are already taxed as income at basic rate before they are added to your account. If you're a non-taxpayer you can't reclaim this but if you're higher/additional rate then happy days as no more to pay. Permitted withdrawals (to 5% pa) are return of capital so not declared - in the same way as if you make withdrawals from an ISA.

Doesn't sound to me like you have anything to report.

thanks, Seed. I'm def not a higher rate tax payer (bitter laugh). I have now put it on the return even though it's under 5% - I can still correct it, but I assume no harm on that as it didn't takje me over any threshholds. But I hope they'll understand that it's been taxed at source anyway. Also nowhere did ask what kind of investment, just 'UK companies' option.

A withdrawal of your own invested money is not income. It is the dividends that constitute the income. As more knowledgeable people above have said, the investment bond has already paid tax on its returns and there is no more to pay. If in doubt / unsure of your numbers I would strongly recommend phoning the provider of the bond.

Don't put your own capital on your tax return as income!

Python, I've only put the amount that accrued in dividents in that year - not including the amount that was there at the start of the year (and stayed there after withdrawal). But would be probably best to speak to them anyway.