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Income tax computation – 10% starting rate for savings income

Forums › ACCA Forums › ACCA TX Taxation Forums › Income tax computation – 10% starting rate for savings income

  • This topic has 0 replies, 1 voice, and was last updated 15 years ago by stubarny.
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  • May 31, 2010 at 2:57 pm #44297
    stubarny
    Member
    • Topics: 9
    • Replies: 11
    • ☆

    Hi everyone,
    According to the F6 (UK version) ACCA exam cover sheets, “a starting rate of 10% applies to savings income where it falls within the first £2320 of taxable income”.
    In the answers to question 1)c)i) of the December 2009 past paper (Questions: https://www.accaglobal.com/pubs/students/acca/exams/f6/past_papers/uk/f6uk_2009_dec_q.pdf Answers: https://www.accaglobal.com/pubs/students/acca/exams/f6/past_papers/uk/f6uk_2009_dec_ans.pdf) only the dividend is listed under “income tax” in the starting rate band, but both building society interest and dividends are listed under “tax suffered at source”.
    Why is building society interest not included in the calculation of starting rate tax (i.e. why is starting rate tax not (1200 + 700)*0.1=£190 instead of 1200*0.1=£120 as written in the answers?
    Many thanks,
    Stu

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