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Odd Self Assessment Calc
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- Lemon Quarter
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Odd Self Assessment Calc
I've just done a Self Assessment for 20/21
Total income from part time salary and Pension is within the 20% band.
Pension was fully taxed at 20%, and Tax paid from PAYE is correct at 20% of everything over £12.5k.
Other income was £450 from Cash savings (so within the Personal Savings Allowance), and £2087 from non-ISA Shares/Unit Trusts etc, so £87 above the allowance.
The HMRC calculation usually adds it all together to give a total taxable income, and then reports savings at 0% but this time has left the excess Divi in the 20% calculation.
The Tax calc therefore gives a "Basic Rate" taxable figure of £87 above the salary and pension income and taxes them at 20%, saying £17.40 is owed.
However I thought Divis were taxed at 7.5% for basic rate taxpayers last year.
Am I missing something?
Paul
Total income from part time salary and Pension is within the 20% band.
Pension was fully taxed at 20%, and Tax paid from PAYE is correct at 20% of everything over £12.5k.
Other income was £450 from Cash savings (so within the Personal Savings Allowance), and £2087 from non-ISA Shares/Unit Trusts etc, so £87 above the allowance.
The HMRC calculation usually adds it all together to give a total taxable income, and then reports savings at 0% but this time has left the excess Divi in the 20% calculation.
The Tax calc therefore gives a "Basic Rate" taxable figure of £87 above the salary and pension income and taxes them at 20%, saying £17.40 is owed.
However I thought Divis were taxed at 7.5% for basic rate taxpayers last year.
Am I missing something?
Paul
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- Lemon Slice
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Re: Odd Self Assessment Calc
You seem to be correct, see tax on dividends
Was surprised to see that the 7.5% will rise by 1.25% this tax year? Fortunately I have managed down my portfolio to not give dividends above £2000.
Was surprised to see that the 7.5% will rise by 1.25% this tax year? Fortunately I have managed down my portfolio to not give dividends above £2000.
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- The full Lemon
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Re: Odd Self Assessment Calc
This is strange. You say it has been left in the 20% calculation, how was it categorised in the start of the View Your Calculation summary? Was it included under 'Employment income', 'Interest from UK banks, building societies and securities etc' or 'UK pensions and state benefits' ?
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- Lemon Quarter
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Re: Odd Self Assessment Calc
My guess would be that you have not put the dividend income in the right 'box'?
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- Lemon Quarter
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Re: Odd Self Assessment Calc
Thanks all,
On the Tax Calculation it is listed as...
"Dividends from UK Companies £2087.00"
And is the total of the "Dividends from UK Companies" and "Dividends from Authorised Unit Trusts" etc figures.
The £2087 is included in the "Total Income on which tax is due" line (along with the savings). This total is Salary + Pension + Interest + divis minus personal allowance.
In the "how we have worked out your income tax" section ...
Pay, Pensions, Profit etc. (UK rate for England and NI)
Basic rate £nn,nnn x 20% This figure is Salary and pension (minus personal allowance) + £87.
Then there is a "Savings interest from UK Banks etc" line that says
Basic rate band at nil rate £450 x 0%
All the PAYE and tax paid balance out, so there is an outstanding balance of £17.40.
OK, so it is only an extra 12.5% of £87, I just cant see why it should be this much.
Paul
On the Tax Calculation it is listed as...
"Dividends from UK Companies £2087.00"
And is the total of the "Dividends from UK Companies" and "Dividends from Authorised Unit Trusts" etc figures.
The £2087 is included in the "Total Income on which tax is due" line (along with the savings). This total is Salary + Pension + Interest + divis minus personal allowance.
In the "how we have worked out your income tax" section ...
Pay, Pensions, Profit etc. (UK rate for England and NI)
Basic rate £nn,nnn x 20% This figure is Salary and pension (minus personal allowance) + £87.
Then there is a "Savings interest from UK Banks etc" line that says
Basic rate band at nil rate £450 x 0%
All the PAYE and tax paid balance out, so there is an outstanding balance of £17.40.
OK, so it is only an extra 12.5% of £87, I just cant see why it should be this much.
Paul
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- Lemon Slice
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Re: Odd Self Assessment Calc
DrFfybes wrote:All the PAYE and tax paid balance out, so there is an outstanding balance of £17.40.
OK, so it is only an extra 12.5% of £87, I just cant see why it should be this much.
Paul
Dividends = £2087.
Dividend tax-free allowance = £2000
Therefore, 20% tax payable on £87= 0.2 x 87 = £17.40
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- Lemon Half
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Re: Odd Self Assessment Calc
I still don't see why the rate is 20% and not 7.5 %
see the example given on this page
https://www.gov.uk/tax-on-dividends
(same link as @seagles posted)
see the example given on this page
https://www.gov.uk/tax-on-dividends
(same link as @seagles posted)
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- The full Lemon
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Re: Odd Self Assessment Calc
Nocton wrote:Dividends = £2087.
Dividend tax-free allowance = £2000
Therefore, 20% tax payable on £87= 0.2 x 87 = £17.40
Why?
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- The full Lemon
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Re: Odd Self Assessment Calc
DrFfybes wrote:In the "how we have worked out your income tax" section ...
Pay, Pensions, Profit etc. (UK rate for England and NI)
Basic rate £nn,nnn x 20% This figure is Salary and pension (minus personal allowance) + £87.
Then there is a "Savings interest from UK Banks etc" line that says
Basic rate band at nil rate £450 x 0%
So is there no section in there:
Dividends from companies etc
Basic rate at nil rate £2000 x 0% ----- £0.00
Basic rate £87 x 7.5% ----- £6.53
I have yet to do my return for 2020 - 21 but cannot see that it would have changed from 2019 - 20. So unless someone else can come up with an answer you will need to ring up HMRC by the look of it.
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- The full Lemon
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Re: Odd Self Assessment Calc
...Unless this dividend income is from property companies, REITs, unit trusts or somesuch, where the tax rate may be 20%?
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- Lemon Quarter
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Re: Odd Self Assessment Calc
XFool wrote:DrFfybes wrote:In the "how we have worked out your income tax" section ...
Pay, Pensions, Profit etc. (UK rate for England and NI)
Basic rate £nn,nnn x 20% This figure is Salary and pension (minus personal allowance) + £87.
Then there is a "Savings interest from UK Banks etc" line that says
Basic rate band at nil rate £450 x 0%
So is there no section in there:
Dividends from companies etc
Basic rate at nil rate £2000 x 0% ----- £0.00
Basic rate £87 x 7.5% ----- £6.53
I have yet to do my return for 2020 - 21 but cannot see that it would have changed from 2019 - 20. So unless someone else can come up with an answer you will need to ring up HMRC by the look of it.
You are correct. That is exactly what I would expect to see, but that section is not there. If I amend the Dividend amount (as I didn't submit the return, I can play with the figures), the £87 at 20% varies.
I might try and delete and re-add the Dividends section later and see if that works.
As I say, a small sum. Most of our investments are in my name at the moment as I'm not earning or drawing a pension, so we arranged things so MrsF just about hits her limits. I was concerned if I'd misunderstood the position. From the replies it seems I haven't.
Many thanks
Paul
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- Lemon Half
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Re: Odd Self Assessment Calc
DrFfybes wrote:XFool wrote:So is there no section in there:
Dividends from companies etc
Basic rate at nil rate £2000 x 0% ----- £0.00
Basic rate £87 x 7.5% ----- £6.53
I have yet to do my return for 2020 - 21 but cannot see that it would have changed from 2019 - 20. So unless someone else can come up with an answer you will need to ring up HMRC by the look of it.
You are correct. That is exactly what I would expect to see, but that section is not there. If I amend the Dividend amount (as I didn't submit the return, I can play with the figures), the £87 at 20% varies.
That is what I'd expect to see too, so not sure what's going on in your case ... are you aware that HMRC has forums too? (And in their forums HMRC staff themselves respond to posts.) You might have a dig through those to see if you can find anyone having reported a similar problem and/or sign up and post your problem there.
https://community.hmrc.gov.uk/customerforums/. I'd suggest the Personal Tax and Self Assessment forums.
Re: Odd Self Assessment Calc
long time since I've posted here. Came to ask a question but was browsing and saw this thread.
I had exactly the same problem with dividends on my 19/20 return.
Interest from UK Banks (£241, within the allowance) and Dividends from UK Companies (£697, within the allowance) were added to Pay from employment. Personal Allowance was deducted to give total that tax was due on.
The £241 interest was removed from in the tax due calculation, but the £697 dividend wasn't, leaving it taxed at 40%.
Did some googling at the time but couldn't find an answer, so wrote it off as me not understanding what was going on.
Not been able to compare for 20/21, as I have no share dividends for that financial year.
I had exactly the same problem with dividends on my 19/20 return.
Interest from UK Banks (£241, within the allowance) and Dividends from UK Companies (£697, within the allowance) were added to Pay from employment. Personal Allowance was deducted to give total that tax was due on.
The £241 interest was removed from in the tax due calculation, but the £697 dividend wasn't, leaving it taxed at 40%.
Did some googling at the time but couldn't find an answer, so wrote it off as me not understanding what was going on.
Not been able to compare for 20/21, as I have no share dividends for that financial year.
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- Lemon Quarter
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Re: Odd Self Assessment Calc
Is this HMRC's tax return platform/software, pardon my diffidence but I use paid for software to lodge the returns I still do (TaxCalc)
The reason I ask is HMRC does have a reputation, from time to time, for having gremlins in its works.
Will have a quick look on Accounting Web to see if there are any threads re the point, catch is accountants tend to use paid for software not HMRC's offering.
The reason I ask is HMRC does have a reputation, from time to time, for having gremlins in its works.
Will have a quick look on Accounting Web to see if there are any threads re the point, catch is accountants tend to use paid for software not HMRC's offering.
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- Lemon Pip
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Re: Odd Self Assessment Calc
Hi,
Yes there are some issues with HMRC's software.
Try here: https://www.gov.uk/government/publicati ... al-returns
The file you want is called Exclusion cases version 4.0 (13 January 2022)
That is in ODT format, only 12 pages long.
If you search on the name then you will find other versions some in PDF on the websites of software suppliers and others. Beware there is a different version for each tax year and each one is issued and reissued many times, as new problems are found and old ones fixed, so there are a lot of versions around.
Regards Gerard
Yes there are some issues with HMRC's software.
Try here: https://www.gov.uk/government/publicati ... al-returns
The file you want is called Exclusion cases version 4.0 (13 January 2022)
That is in ODT format, only 12 pages long.
If you search on the name then you will find other versions some in PDF on the websites of software suppliers and others. Beware there is a different version for each tax year and each one is issued and reissued many times, as new problems are found and old ones fixed, so there are a lot of versions around.
Regards Gerard
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