Self assessment and student loan

Previously I declared myself self employed due to some small earnings totalling less than £100 per year. But I haven't done that for nearly two years. BUT I haven't undeclared myself as SE so I still have to fill that form in.
So I filled everything in expecting to see Total: £0.00, but.. SURPRISE! HMRC calculate my total as £248! I couldn't believe they wanted that much for earning nothing. But it turned out that that it was actually a student loan repayment.
I didn't think I'd earned enough to trigger it but on investigation I have so fair enough I'll be paying it. But I would have thought it would come out of my PAYE salary. Did HMRC instruct my employer to not make any payments so that its done at SA time?
Also, I filled in the interest I earned from banks and it looks like HMRC are including that as my taxable income even though my bank already deducted tax. Should I declare £0 for bank interest?
Reply to

It is part of your taxable income, and can make a real difference if you
are on higher rate tax (and for some people who would never have had a student loan!)
HMRC add up all your income and work out how much tax is due, then look at how much tax you have already paid, including that paid by your bank,
and take that off the amount due.
Only if you want a tax audit and fine! The banks tell HMRC about the interest, and HMRC's shiny new computer system uses this to cross check against the tax returns.
Note, for some people, the tax due on the bank interest is less than the
amount paid by the bank, and if they fill in the tax form, or ask nicely
(there is a form for this), HMRC will pay it back. That is particularly
likely to happen for married women on just the state pension.
Reply to
David Woolley
The bank interest section should include interest earned and tax paid in the approriate boxes.
That way the gross interest is added into your taxible income, and the tax paid is added to your PAYE payment and subtracted from the total tax liability.
Reply to
At first glance it looked like HMRC were charging me tax on this income a second time since it was used to calculate the tax due total. But having a closer look I see they also work out the tax I would have paid and include that in my total.
HMRC seem to have charged me 25p for tax. I can't possibly owe any tax since every source of income has already been taxed. I can only guess it's because they rounded my earnings up and my tax paid down and I'm paying 25p on some non-existent £1 of earnings. I don't think I'm going to bother arguing about it though.
Reply to

HMRC round in your favour (income dpwm, tax paid up). If you submitted online before the end of December, you should have been able to get the 25p applied to your tax code, where it would be lost in the rounding.
Reply to
David Woolley

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