Interest on Company bank account

[gadgetman]

My bank (Abbey Business) deducts tax for the small amount of interest earned each month in my current account and annually for the amount in my deposit account.

In my end of year accounts (ending Nov 2007) the accountant included interest in the income figures. My query is that surely this means I am paying tax on it twice?

I've been trying to get an explanation from the accountant but as usual its not too clear what's going on.

Is the problem that the bank shouldn't be deducting the interest at all?

[TheFaQQer]

My bank (Abbey Business) deducts tax for the small amount of interest earned each month in my current account and annually for the amount in my deposit account.

In my end of year accounts (ending Nov 2007) the accountant included interest in the income figures. My query is that surely this means I am paying tax on it twice?

I've been trying to get an explanation from the accountant but as usual its not too clear what's going on.

Is the problem that the bank shouldn't be deducting the interest at all?

Abbey have got it wrong - they did the same to me. A few dozen phone calls to their help line may get it sorted. BUT if they don't refund it before the end of the tax year, you need to offset it from the CT that your company pays next year, which is a PITA.

[Lewis]

My bank (Abbey Business) deducts tax for the small amount of interest earned each month in my current account and annually for the amount in my deposit account.

In my end of year accounts (ending Nov 2007) the accountant included interest in the income figures. My query is that surely this means I am paying tax on it twice?

I've been trying to get an explanation from the accountant but as usual its not too clear what's going on.

Is the problem that the bank shouldn't be deducting the interest at all?

You should be paid ineterst GROSS on your business bank account then include that interest in your income in accounts and pay tax accordingly.

[FarmerPalmer]

You put it in Box 6, but claim the tax in box 84 of the CT600 (short).
I did mine yesterday.