Underpaid interest by £211? RBS

Mark A · 25 Jun 2009 at 20:23

Hi guys,

Not sure if i have been paid the wrong amount of interest here or not. Ive just been on the phone to RBS and the woman said its because the interest rate has dropped, which seems completely wrong to me. Then she said she will check something and put me on hold for 10 mins and then tried selling me another savings account if I'm not currently happy with this one :mad:

. Then she put me through to another department so i hung up.

Ive had about in my Direct Saver account for a few years now. At the beginning and a fair way through this tax year the interest rate has been pretty high. The interest is calculated daily then paid into the account annually, so any interest made when the interest was high should have been banked.

I got an interest certificate through the door saying i had received after tax but then when i checked my account Ive only been paid £

. The certificate isn't dated but i think i got it around the same time the money was paid into my account, which was April 30th. Also the certificate says tax year 2008-2009.

Has this happened to anyone else? How did you sort it? I was going to pay a visit to my branch but its a direct saver account and is internet only, so I'm not sure they will be able to help me.

Vixen · 25 Jun 2009 at 20:32

Was it Direct Banking who tried to sell you another account? They actually have sales targets and lose their jobs if the targets aren't met consistently!

I'd call back and ask to speak to a team leader, but don't kick up a fuss. Even if the team leader can't help you, they should be able to pass your details on to customer care who look into it and call you back within a few days.

Mark A · 25 Jun 2009 at 20:46

Vixen said:
Was it Direct Banking who tried to sell you another account? They actually have sales targets and lose their jobs if the targets aren't met consistently!

I'd call back and ask to speak to a team leader, but don't kick up a fuss. Even if the team leader can't help you, they should be able to pass your details on to customer care who look into it and call you back within a few days.

I called the savings accounts helpline, i think it was. She told me I'm only getting 1% interest at the moment and if i open a royalties savings account I'll get 1.5%

. I suppose that would be better but I'm going to downgrade my royalties account for a basic current account and transfer all my savings to a better savings account at another bank anyway.

I don't understand why Ive been sent this certificate claiming i have received more than i have. I explained it all clearly to her and she put me on hold to "check into it" and then came back with no help at all, just I'll pass you onto telephone banking service.

I guess I'll just have to ring telephone banking service and see what they say. I'll ask to speak to a team leader if i don't get anywhere but i wont kick up a fuss, they're just doing their job and it could be me whose mistaken anyway.

What would help is if i knew when the interest rates plummeted, i could possibly work out what i should have made.

muon · 25 Jun 2009 at 21:27

Tax certificate will state all income for the tax year. Perrhaps you aren't correctly looking at all the payments throughout the year?

1.5% is a terrible rate.

Look here for advice on getting a better rate for the next year.

http://www.moneysavingexpert.com/banking/

Alasdair · 25 Jun 2009 at 22:22

Just work out your interest accrual yourself in Excel, I spend all day doing this for loan interest and it really is a piece of cake.

Interest = principal balance * rate *(days / 365)

Do this for each change in rate and that will give you your total interest accrued.

HangTime · 25 Jun 2009 at 23:29

To receive £463.71 after tax, assuming you're a 20% payer, you'd need to be earning around £579.64/year gross. On a £12k balance that would mean the equivalent of around 4.8% over the year.

Now, bearing in mind that the base rate was 5% in April 2008, and this RBS product doesn't seem to be the most competitive (although not too bad), I think it's unlikely that you'd have earned that much interest on a flexible rate product. Especially considering by 6th November (5 months of tax year left) base rate had been slashed to 3% and tailed off even further after that. Yes, the savings product rate probably lagged behind a bit but even so, unless you started the tax year with a very high rate I think you'd be struggling to bring in that ~£580.

I'm not saying it's impossible and certainly if you were bagging say 6%+ in the early part of the year, on a balance a bit bigger than you thought, that £464 figure could be genuine.

Energize · 25 Jun 2009 at 23:44

Mark A said:
I called the savings accounts helpline, i think it was. She told me I'm only getting 1% interest at the moment and if i open a royalties savings account I'll get 1.5% . I suppose that would be better but I'm going to downgrade my royalties account for a basic current account and transfer all my savings to a better savings account at another bank anyway.

http://www.moneysavingexpert.com/savings/savings-accounts-best-interest#instant

3.21% instant access.

Mark A · 26 Jun 2009 at 00:04

This is what the certificate says:

"Tax year 2008-2009

We have pleasure in advising you of the interest paid on your Direct Saver Account during tax year ended 5 April 2009

Gross interest of Income Tax deducted of Actual amount received

Or am i just getting mixed up and this was the interest i received last year? The interest is supposed to be calculated daily then paid at the end of the tax year so i would have expected this certificate for 2008-2009 to say
Energize & ghost101, thanks for the links, i really do need to get a new savings account set up. I really liked this setup as i have all my RBS accounts online and can swap funds between them instantly if i need to. Just a shame RBS aren't offering anything remotely competitive.

Vixen · 26 Jun 2009 at 00:41

My boyfriend works in direct banking and just got home so I told him about this thread. He says:

The certificate you got was for interest recieved between 2008 and 2009, it is for tax purposes so shows the amount pre-tax. Interest rates started to drop around the time Fred Goodwin left, apparently the direct saver has been around 1.5% since then. Also, the direct saver is currently the best savings account available through RBS.

EDIT: Ok, he confused me. The letter is for interest paid into the account within the 08-09 tax year, ie the interest paid in April 08. You'll get a letter for interest paid in April 09 (09-10 tax year) next year. He says if you go back a year in statements, you'll find a payment of £463.71 in April 08.

muon · 26 Jun 2009 at 00:46

Vixen said:
He says if you go back a year in statements, you'll find a payment of £463.71 in April 08.

That makes a lot more sense. I guess the OPs payments are times to be recieved at the beginning of the tax year rather than the end.

Fortyseven · 26 Jun 2009 at 00:50

ghost101 said:
That makes a lot more sense. I guess the OPs payments are times to be recieved at the beginning of the tax year rather than the end.

Yes, they are.

Vixen · 26 Jun 2009 at 00:51

ghost101 said:
That makes a lot more sense. I guess the OPs payments are times to be recieved at the beginning of the tax year rather than the end.

It seems that's how all RBS accounts work. Apparently there were a lot of people concerned about their tax certificates this year as obviously there's a big difference in interest rates.

Mark A · 26 Jun 2009 at 01:05

Ahh thanks for the help guys

.

Yeah i was pretty shocked at how low the interest was this year. I guess i was just hoping it was a mistake

. Oh well time to change savings account, will have a proper look through MSE tomorrow.