ISA or tax free

cheerfulcat

bristolleedsfan wrote: »

im fully aware of the tax allowances and tax rates etc, posters were not talking about what is best to do for this tax year only hence reason why i quoted tax bands that we KNOW will be in force after this tax year.

But you implied that the 10% band covers all " unearned " income - it doesn't, just the first £2k-and-a-bit of taxable income. Just trying to make that clear! From your earlier post -

as previous poster said yorkshire pays 7.10 gross, if the person became a taxpayer on unearned income they would pay tax at 10% rate so 7.10% would become 6.39% which is higher than most isas.

if the person started paying tax based on earned income ie @20% the 7.10% rate would become 5.68% which is still better than some isas and not much below the higher paying isas, gap has narrowed due to yorkshire not passing on recent base rate rises in full.

Edited to add: I take your point that some non-ISA accounts may pay more interest than some ISA accounts, even after tax, but I would still suggest that tax shelters should be used while they are available.

bristolleedsfan

cheerfulcat wrote: »

But you implied that the 10% band covers all " unearned " income - it doesn't, just the first £2k-and-a-bit of taxable income. Just trying to make that clear! From your earlier post -

conversation started re a "non tax payer", i merely gave answers and examples answering the posts, non tax payer rates are self explanitory ie gross, i then gave examples @10% rate which for avoidance of doubt i quoted as non earned income rate because we all know thats what the 10% rate will become, i didnt give any figure that 10% unearned income rate was applicable for because that would be up to each individual saver to look at their own unearned income level as @7% someone would have to have approaching 30000 to reach the 20% tax band level income level ( after theve used their personal allowance up)

some people will have 30000+ as above described, others will only just slip into the 10% band.

original poster stated " as a non taxpayer" so from that it was assumed that he/she wouldnt be exhausting the 10% unearned income band anytime soon hence the words used, "if she became a taxpayer at the 10% band level"

i did also quote the 20% tax band because i was answering a different poster and giving examples which that poster had asked for.

like clapton said if she was a stay at home mother she could have 87000.00 earning 6% before she even moved into the 10% tax band.

purpose of the posts was illustrating some non isa rates at gross/10%/20% rates compared with some isa rates, all based on non specific circumstances