Taxes Management Act 1970 section 18

Interest paid without deduction of income tax

Section 18 requires certain persons who pay interest without deducting income tax to provide information returns to HMRC about those interest payments.

• Banks, building societies and other deposit-takers who pay interest without deducting tax must report details of those payments to HMRC.
• The reporting obligation covers interest paid or credited to individuals and other persons in the course of a trade or business of receiving deposits or lending money.
• Returns must include the name and address of the person receiving the interest, the amount of interest paid, and such other particulars as HMRC may require.
• The data-gathering powers introduced by Finance Act 2011 updated and extended the framework under which HMRC can require these information returns.

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