NCBS Index Linked Savings Bonds & Tax ?

kamir

In 2010 i invested in the NCBS Index Linked Savings Bond - Issue 3, the bond matured this week but unlike similar products the interest was paid gross. Does anyone know what the tax position with these ?

I've had NSI Index Linked bonds before and they are tax free.

http://www.ncbs.co.uk/savings/withdrawnaccounts/fixedterm/3rd-issue-index-linked-bond-(withdrawn).aspx

Ballard

NS&I (which is what I'm assuming you mean by NSI) are able to offer products tax free as they're run by the state. Building societies are unable to do so.

Edit: Ah. Hang on. I've misunderstood. You've received the interest gross. I'm that case I have no idea. Sorry.

kamir

Yeah interest received with no tax deducted

Ballard

The only thing that I can think of is that there used to be a rule that interest was paid gross on any fixed deposits of £50,000+ (I think). It's been a while since I was involved in that side of things so the rule may well have changed.

masonic

kamir wrote: »

In 2010 i invested in the NCBS Index Linked Savings Bond - Issue 3, the bond matured this week but unlike similar products the interest was paid gross. Does anyone know what the tax position with these ?

The income is taxable, so you will need to declare it if you would normally pay tax on savings interest.

Ballard

It was definitely a rule and as far as I know still is. My thinking has been that people with large deposits are more likely to be higher tax payers so will need to declare the interest on their tax returns anyway and deducting 20% wouldn't be enough. That's only my assumption though.

bigfreddiel

Ballard wrote: »

NS&I (which is what I'm assuming you mean by NSI) are able to offer products tax free as they're run by the state. Building societies are unable to do so.

Edit: Ah. Hang on. I've misunderstood. You've received the interest gross. I'm that case I have no idea. Sorry.

Does nobody actually read posts?

The question is about nobs not ns&i!

ncbs = national counties bs

So the answer is to read the t&cs

Cheers fj

Ballard

bigfreddiel wrote: »

Does nobody actually read posts?

The question is about nobs not ns&i!

ncbs = national counties bs

So the answer is to read the t&cs

Cheers fj

The OP mentioned both ncbs and NS&I so it would seem perfectly reasonable to mention both institutions in my reply. As it happens I had got my facts wrong (as shown in my edit). Perhaps you should read more carefully before you reply.

masonic

I hesitate to even ask who or what "nobs" is

le_loup

Google it!

xylophone

The rule that allowed interest on certain fixed term deposits of £50,000 or more to be paid gross was repealed from the start of 2012/13 for new deposits, but the rule continues to apply to deposits made before 6 April 2012.

This is savings income paid gross but is taxable according to normal rules.