Fluffyhead

Premium Bonds are one of the few places non residents of the UK are allowed to have their savings. I have never put the small winnings I've had so far on the pt tax return - I got the idea from somewhere that if it was less than a certain amount you didn't have to. Recently I won £500 so now think maybe I ought to but I have no idea where to put it or
if I have to - does anyone else declare them and if so where? Thanks

Red Eric

Not from personal experience but from a working knowledge of the tax system.

Yes, you should declare (all) Premium Bond gains on your PT tax return. They would go in Anexo J, Quadro 8 (Categoria E - Rendimentos Capitais) using Codigo E22.

You have an option to exercise as to whether they are taxed at the normal PT withholding rate of 28%, or to opt for englobamento, in which case they will be taxed at scale rates, taking all other income into account. If you opt for englobamento, all other income in Category E must also be declared here.

Fluffyhead

That's really helpful, thanks Red Eric

Red Eric

Thanks for the thanks

I'm going to qualify one of my statements above because as it stands, it's not entirely accurate.

When I said :
...what I should have said was, you must opt for englobamento for all other income in Category E.

As you can probably already see, it's obligatory to declare foreign-sourced Cat E income on Anexo J, Q8, so it goes without saying that anything else of that nature arising in the UK would have to be declared here. The salient point I should have made clearer is that if you opt for englobamento for that, you must also declare PT-sourced Cat E income on the appropriate other Annex and opt for englobamento of that (as opposed to the otherwise perfectly valid options of not declaring it and leaving it to be taxed at the withholding rate, or declaring it and not opting for englobamento)

I hope that makes some sense.

Fluffyhead

Hello again Red Eric - Thanks for thanking my thanks!
Sorry I've been so long in replying - overloaded with so many other things including UK tax returns!
I haven't had time yet to look into Cat E income but englobamento is a minefield we used to walk through every year. It's a pain that you can't simulate your tax online because of foreign income. We have learned to avoid the minefield by submitting a return including englobamento and then submit it without englobamento and choose the one in our favour!

MRL

Please explain the process of submitting 2 IRS tax returns. I'm intrigued.
Do you get 2 tax bills then pay the lowest?
Can you then delete one IRS tax return in the system?
Thanks

Fluffyhead

MRL, Sorry I've taken so long to reply, crazy busy. Finally submitting getting round to our tax return today.
We submit the first declaration of the year choosing no englobamento, then wait to see what we have to pay. If we think it excessive we submit a substitution declaration including englobamento then wait till that bill comes in and choose which to pay. We don't delete anything, it's just a re-submission.
If you discover you've made a mistake, as I did one year, then resubmit using the correct data.