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Investment income - self assessment required?

CeeJaySixCeeJaySix Well-KnownRegistered Posts: 645
Afternoon all,

Hopefully this is a simple question for someone - I'm sure the answer is 'No' but I can't find any definitive guidance to confirm, and its not an area I work in. Friend has just invested a fairly substantial sum of money in an accumulating investment fund. Dividends/interest received (and automatically reinvested) are therefore taxable. However, he is a basic rate taxpayer (including the investment income), and therefore the div credit will cover the tax payable (and the interest is paid net); he's employed (PAYE) and no other income; surely he does not need to self-assess until he either A. goes into higher rate or B. sells holdings at a profit and is therefore liable to CGT? His broker has suggested he may have to, but I can't see any reason why.

Thank you to anyone who can confirm (or otherwise!).

Comments

  • Rozzi RainbowRozzi Rainbow Trusted Regular Registered Posts: 465
    Hi. I would have agreed with you the answer would be No, but just checking on the HMRC website it looks like he might have to. There is a checking tool here:

    https://www.gov.uk/check-if-you-need-a-tax-return

    and it appears if you have savings/investment income of over £10,000 then you do need to register.
    MarieNoelle
  • CeeJaySixCeeJaySix Well-Known Registered Posts: 645
    Thanks Rozzi, I saw that, and based on the answers unless he breaks that £10k in a year (which would be a big year on the amount he's invested) it seems to imply he's okay. I can't find anything to suggest he does have to tell HMRC about the extra income, just wanted to be sure.
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