Endowment pay out and tax

ausa

Hi

I have an endowment policy due out next year there is a short fall on it, however the main question is as I am due to a divorce, selling the house will I have to pay tax on it? The policy started in 1987 and what ever money is due will go to reducing the current mortgage.

Accepting there is a short fall on the predicted amount of 10k would I be better off transfering the money now to the mortgage or continue paying it till next August whether the house is sold or not?

Many thanks for any help on this

kingstreet

As this is likely to be a qualifying policy, I'd say it's likely to be free of tax unless you altered it in any way during the term. Ask the insurer if you need clarification.

McKneff

And dont forget, if you cash it in now you wont get any terminal bonus which may be added next year.

Ive had quite a few endowment policies pay out over the years, it's literally just a cheque so no you wont pay any tax on it