Tesco new 1.35% rate (including bonus) Internet saver
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I opened the new account last week & transferred money from another Tesco savings account. I’m still unable to withdraw any money from the new account when the 48 period has well been passed. I telephoned & they said it was because they had a backlog of processing all the new accounts. I’ve been a Tesco Bank customer for years & never had this problem before. It’s so frustrating & thankfully I can access funds in another account with a different bank. Just hope they get it sorted quickly.
Thats what I was also told yesterday. I can now make withdrawals on my account.0 -
Im still waiting also....
Luckily I funded the higher rate Internet saver so getting 1.35 rather then the lower ones.
Waiting to transfer out of the IS into my Tesco current account.
I called yesterday and was told the same as above, so let hope it releases by Friday.
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Although now only 1.2%. My wife has opened another Internet Saver added to her FR Bond and 2 other Internet Savers used for DD's. Anyone know why she cannot make payment but can transfer from other accounts internally and externally.
Surely she hasn't got to wait for welcome pack for proof of address and ID, has she?0 -
Unless you need to actually spend the interest each month, there is really no logical argument for settling for a lower AER simply because interest is paid monthly.
The logical argument is to ensure interest is spread evenly to avoid big variation in taxes assessed from April to April. If the money isn't withdrawn and interest compounds the result is the same. When the option exists, monthly interest is the better choice.0 -
I don't follow that logical argument.The logical argument is to ensure interest is spread evenly to avoid big variation in taxes assessed from April to April. If the money isn't withdrawn and interest compounds the result is the same. When the option exists, monthly interest is the better choice.
If you ask to receive the interest monthly rather than waiting to receive it at the end of the year, you will receive more of it sooner rather than later and tax will be due in an earlier tax year.
For someone whose marginal tax rate is going to be higher in the next tax year I suppose they would want to get the interest dealt with quicker. For the rest of us, if we don't need to receive the money now to spend it, we would prefer to deal with it as taxable income in a later tax year when we have lower income, larger allowances or have had more time to have made other tax planning arrangements.
It doesn't follow that monthly is "the better choice".0 -
In some circumstances it is but in some other circumstances it isn'tmonthly interest is the better choice.
I have lower taxable income this year than last so arranged to move as much into this year as I could, using annual interest, to take advantage of a lower rate and various allowances. If I had taken monthly interest I might have paid 40%, whereas this year I will pay no tax at all on some of it. Hardly a better choice
Horses for courses0 -
Yes I agree. I have monthly interest wherever possible as it spreads out interest throughout the year and avoids a large interest payment which could need tax to be paid0
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What problem(s) do you perceive with big variations? How do you define 'big variation'?
See below.bowlhead99 wrote: »I don't follow that logical argument.
If you ask to receive the interest monthly rather than waiting to receive it at the end of the year, you will receive more of it sooner rather than later and tax will be due in an earlier tax year.
For someone whose marginal tax rate is going to be higher in the next tax year I suppose they would want to get the interest dealt with quicker. For the rest of us, if we don't need to receive the money now to spend it, we would prefer to deal with it as taxable income in a later tax year when we have lower income, larger allowances or have had more time to have made other tax planning arrangements.
It doesn't follow that monthly is "the better choice".
What you state is true and is precisely the issue. Few will look to the benefits of the scenario you describe (intentionally timing for tax year) with savings accounts (unlike more strategic plans like tax loss on shares dealing), but they will disadvantaged (or, at least, have no choice) with the timing variations.
There is no standard definition of "annual", some pay on account anniversary e.g. Sainsburys, some pay on arbitrary e.g. Nationwide in October, some pay just before tax year e.g. Virgin. In today's world where rates are frequently changing and people swapping across these it is very easy to end up with lop sided payments e.g. 1 year's worth from one and 1.5 year's worth from another in same tax year.
Monthly payments do not have these concerns, it is a matter of an extra month's payment at most, and with the monthly amounts compounding when not withdrawn the outcome is the same. Monthly gives the additional flexibility if skimming interest, and when not it is all equal so monthly should be the preferred default. Only in a scenario like the one you describe to intentionally manipulate balance from one year to the next for tax purposes is there any merit in choosing annually paying ones to extend/shorten the cycles.In some circumstances it is but in some other circumstances it isn't
I have lower taxable income this year than last so arranged to move as much into this year as I could, using annual interest, to take advantage of a lower rate and various allowances. If I had taken monthly interest I might have paid 40%, whereas this year I will pay no tax at all on some of it. Hardly a better choice
Horses for courses
Yes, fine, you are describing the same scenario as done already by bowl. Annual can occasionally be beneficial to juggle tax years but I would strongly disagree this should be the default advice given on a forum such as this. There will always be exceptions, horses for courses, etc., and some users who insist on sticking to making a technical point rather than see big picture or have humility to drop an argument.0 -
Annual can occasionally be beneficial to juggle tax years but I would strongly disagree this should be the default advice given on a forum such as this
Pretty certain I didn't assert that annual interest should be the default choice but let me check ...
Nope, I didn't, because it is not my position. Equally I disagree that 'monthly interest is the better choice'. Both are valid depending upon circumstances and neither are a better or default choice. As I did say - Horses for courses0
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