Bank,building society or what?

ron101

Hi im a single person 54 invalid with 240.00 coming in per week.My mothers just died and iv got 22500.00 cheque gift from her property, Now what do i do to avoid tax.I want cash lump sum so do i put it in the Bank,Building society. Isa or what i just dont now.I just want a lump sum.Or do you now where i can cash the cheque England,Overseas anywere.Ive now become a non tax payer because of my injurys.

Robert_Sterling

The income from £22,500 in a Building society would be about £1,125
If you pay income tax already then this would be taxed at 20% which means that £225 would be taken in tax. If you had not used up your £2000 band which is taxed at 10% you would be able to reclaim some of the £225.

codetown

I am not sure if I understand correctly, ron. What tax do you want to avoid?
If you are thinking to inheritance tax, then I think you can safely widraw that check everywhere and will not have taxes to pay on it (I belive the threshold for inheritance tax is much higher).

As for future investments, of course there will be taxes on the interest you gain, depending on your situation. If you are a non-tax payer, you will just ask for a payment of your interests gross. There is a form which any bank can give you to fill when you ask to have your interests paid gross.

Mikeyorks

ron101 wrote:

I just want a lump sum.Or do you now where i can cash the cheque England,Overseas anywere.Ive now become a non tax payer because of my injurys.

Ron. It's a bit unclear from your post what you're after - in detail?

If I take the bit above, in isolation, it really does sound as though you're after converting the cheque to cash - and then holding onto the cash! No one on here is going to give you any advice on doing that - as it's both unwise and unsafe.

So - I'll assume I've misunderstood. I'll also assume that some of your £240 per week is in the form of allowances - and that's why you don't pay tax? But do you have a Bank account?

If so you can simply (another assumption the cheque is in £Sterling) pay the cheque into that account. Then I would personally go into the Bank (but tell us which one, first?) and ask their (free) advice on opening a deposit account to put the money in. If the interest you get still leaves you outside tax -they will help you fill in an R85 which means you will get all the interest. If it does push you into paying tax - they will deduct 20% from the interest, when its paid - and without you having to do anything more. But I would recommend you put £3000 of it into an ISA - as that's definitely tax free.

If you're totally against the risk of anything that pushes you into tax - then put £3000 into an ISA and the rest into Premium Bonds. With either of those - there is definitely no tax payable and you can get hold of the money again within a few days - if you choose.

But I think it now needs a bit more detail from you??

Mike

Milarky

Mikeyorks wrote:

If you're totally against the risk of anything that pushes you into tax - then put £3000 into an ISA and the rest into Premium Bonds. With either of those - there is definitely no tax payable and you can get hold of the money again within a few days - if you choose.

National savings also do Fixed interest (2 or 5 year) and Index-linked (3 or 5 year) 'tax free' investments - but they are paying a 'naff' rate unless you are not a higher rate taxpayer - and you loose instant access/reasonable notice.

http://www.nsandi.com/products/index.jsp

(Under those circumstances even I might suggest PBs.. and I'm a skeptic about those!)