Non-working wife savings

will1970

My wife and I have inherited some money. My wife does not work (other than nursing bank shifts every now and again - but hasn't done any since last summer). She is currently receiving statutory maternity pay as she does not work enough for employer based one (I think). Is she better to invest money in her name as her taxable income is so low? If so, what are the thresholds, etc.?

Thanking you in advance for any responses.

Reaper

I assume you mean save not invest, otherwise we need to talk about capital gains tax.

You can find the tax bands on this page. The personal allowance that probably applies is £6,035 for 2008-2009 and £6,475 next year.

That amount can be earnt tax free so if her current income is less than that then you would be better off putting some savings in her name (assuming you have used up your cash ISA allowance already).

Ask the bank to pay the interest tax free to avoid having to reclaim it at the end of the tax year. You just have to fill in a short form.