Can I amortise savings bond income?

stewdaviesuk

We have a sum of money we need to keep as cash for now. We have looked at putting it in a one year bond at 3%. The wife is a non taxpayer and the interest would not take her over the yearly allowance, if however it was put it in say a 3 year deal then the 3 years interest when paid at completion would give rise to a tax bill, unless we could declare the tax yearly before it was paid in the sum at the end.

Is this possible?

oldfella

sorry - income creates a liability for tax in the year it is paid. Go for a monthly or annually paid bond.

Loughton_Monkey

ICICI Bonds (e.g. 4% 3 year) have monthly Interest Option.

Stompa

IME most bonds tend to pay interest annually or monthly rather than just at maturity.