What do I need to do about tax.in savings interest?

[Bigweekend]

I have a reasonable sum saved, but not enough to breech the £1000 limit on interest for tax to be due. Except now rates are improving and I can get up to c. 4% fixed, I will.

Otherwise, my tax affairs are straightforward, I just pay PAYE. What do I need to do to declare this income and pay the tax due?

You can just call HMRC after the end of the tax year, let them know how much interest you received and they will work it out for you. It can be done on your HMRC online account too.

Put it in an ISA and there will no tax due as they're tax-free.

I've used my ISA allowance. This is outside of that

Thank you

I’ve also wondered about this and presumed that when you open a new savings account whether it be an ISA or bonds that you have to provide your NI number, so assumed the HMRC would be informed of interest you receive.

This happened to my Dm. They wrote after the end of the tax year saying she owed tax on savings and had adjusted her tax code for current year and collected it by paye.

No, they don't generally ask for your NI number.

@PuppaDontPreach Barclays and Tesco Bank both asked me when opening recent ISA’s and savings accounts.

ISAs yes as you can only put in a certain amount per annum (but of course anything in an ISA isn't taxable). It's not the norm for savings accounts.

The banks report to HMRC at the end of the financial year and that will flag up where your annual interest has gone above £1k. They will then adjust your tax code to claw the tax owed back

Soni don't need to "do" anything. Even if the savings are across different banks?

You can buy premium bonds with the excess

Yes, I know all the places to put money to avoid it, but I have some accounts where tax will be due.

Premium bonds are not great advice. Returns are very low (unless you get lucky) so you're probably still better off paying tax on interest.

Premium Bonds for me has been great. I have the full £50,000 and am on about 6% winnings, my DH isn’t doing as well he’s on around 3%.

No, you don't need to do anything