We'd like to remind Forumites to please avoid political debate on the Forum. This is to keep it a safe and useful space for MoneySaving discussions. Threads that are - or become - political in nature may be removed in line with the Forum’s rules. Thank you for your understanding.

Tax and tax band implications of large savings

I have a query.... my boyfriend lives abroad at the moment. He will soon be given £10000 by his parents however he wants to put it into my account as in the current climate he will essentially lose money if he takes it abroad.

However does this have any implications on my tax band as a friend mentioned it may do?

He does not have a UK account anymore so i was going to look after it for him until things change wth interest rates or he comes back to england-whatever is sooner, but i am unsure whether having this money in my account will have implications on my tax bracket and push me into the higher earners bracket as i am currently just under this-or do savings not count towards that? Total novice with these things i'm afraid! Help!?

Comments

  • Wookey
    Wookey Posts: 812 Forumite
    You would need to be awfully close to the 40% tax bracket, assuming you have an interest rate on your account of 4% then the extra 10k would give an extra earning of £400 per year. Best place to put it would be in an ISA, 3.6k now and 3.6k as soon as the new tax year starts on 6th April. That would leave only 2.8k that you would need to place into a taxable account.
    Norn Iron Club member No 353
  • nzseries1
    nzseries1 Posts: 2,240 Forumite
    I would say don't put it in an ISA - because once your boyfriend wants the money back you will lose the tax-free status on it forever.
    You're spelling is effecting me so much. Im trying not to be phased by it but your all making me loose my mind on mass!! My head is loosing it's hair. I'm going to take myself off the electoral role like I should of done ages ago and move to the Caribean. I already brought my plane ticket, all be it a refundable 1.
  • CLAPTON
    CLAPTON Posts: 41,865 Forumite
    10,000 Posts Combo Breaker
    You can have income (earnings plus benefits in kind plus interest (excluding ISA) plus dividends less pension contributions) up to 40,835 this tax year rising to 43,875 in April 2009 beforer you pay 40% on the marginal amount over these limits.
This discussion has been closed.
Meet your Ambassadors

🚀 Getting Started

Hi new member!

Our Getting Started Guide will help you get the most out of the Forum

Categories

  • All Categories
  • 348.2K Banking & Borrowing
  • 252.1K Reduce Debt & Boost Income
  • 452.4K Spending & Discounts
  • 240.8K Work, Benefits & Business
  • 617K Mortgages, Homes & Bills
  • 175.6K Life & Family
  • 254K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 16K Discuss & Feedback
  • 15.1K Coronavirus Support Boards

Is this how you want to be seen?

We see you are using a default avatar. It takes only a few seconds to pick a picture.