Interest

The HMRC SA Computer will not accept amounts of tax which exceed the gross income taxed at the lower rate of tax on page 3 of the tax return. If tax has been deducted at a higher rate we recommend that a note is placed in the additional information section of the main return.

For the 1997 year, it is important to identify the difference between interest which is taxed under Schedule D case III from other sources. Most interest is taxed under an actual basis but income taxed under Schedule D case III is taxed on a prior year basis. The 1997 year was the year of transition from prior year basis to current year basis. From 1998 onwards the distinction between Schedule D III and other interest is of no relevance for tax purposes. Schedule D III interest is received gross, without deduction of income tax.

Refer to the Tax Guide for more information.