Mini Cash ISA Britannia BS

steady__eddie

I transferred my Brtannia TOISA to a better payer earlier on in the year but I received a cheque from today i.r.o. the tax which they had deducted from the "Membership Reward" which I received earlier on in the year.
The accompanying blurb states, "We approched HM Revenue & Customs who have listened to our suggestions and, as a result, have made an amendment to the law which favours building society members who receive a loyalty bonus. This amendment has been agreed with effect from 2007 and means we're able to pay the reward earned on the ISAs and Child Trust Funds tax free, and this will apply for every annual reward payment made from now on."
C.T.F. a/c.s will be paid tax free from 2008 onwards.
I know that we're only talking a couple of bob here but it may elevate Britannia status to respectable mediocracy.

baby_boomer

steady__eddie wrote: »

This amendment has been agreed with effect from 2007 and means we're able to pay the reward earned on the ISAs and Child Trust Funds tax free, and this will apply for every annual reward payment made from now on."

A pity they won't be able to get Treasury agreement to pay mortgage customers tax free.

A 40% / 22% taxpayer who is a mortgage customer with Britannia would do far better if Britannia just paid them a better rate, rather than giving them a taxable reward .

The scheme remains a means of subsidising the Treasury at members' expense. To say nothing of the bureaucratic cost of running it .

steady__eddie

"The scheme remains a means of subsidising the Treasury at members' expense. To say nothing of the bureaucratic cost of running it ."

Don't you mean that it's a way of subsidising members at the treasurys' expense ? (saving members that is).

bristolleedsfan

baby_boomer wrote: »

A pity they won't be able to get Treasury agreement to pay mortgage customers tax free.

A 40% / 22% taxpayer who is a mortgage customer with Britannia would do far better if Britannia just paid them a better rate, rather than giving them a taxable reward .

The scheme remains a means of subsidising the Treasury at members' expense. To say nothing of the bureaucratic cost of running it .

:T

all the other building societies agree ( and so do i) which is y none have followed brittannias points thing.

bristolleedsfan

steady__eddie wrote: »

I transferred my Brtannia TOISA to a better payer earlier on in the year but I received a cheque from today i.r.o. the tax which they had deducted from the "Membership Reward" which I received earlier on in the year.
The accompanying blurb states, "We approched HM Revenue & Customs who have listened to our suggestions and, as a result, have made an amendment to the law which favours building society members who receive a loyalty bonus. This amendment has been agreed with effect from 2007 and means we're able to pay the reward earned on the ISAs and Child Trust Funds tax free, and this will apply for every annual reward payment made from now on."
C.T.F. a/c.s will be paid tax free from 2008 onwards.
I know that we're only talking a couple of bob here but it may elevate Britannia status to respectable mediocracy.

cheers 4 info, brittania certainly have some friends in high places.

most of brittannias rates are still more than 0.40% below a good rate.

the best way of rewarding loyalty imo is to launch members Privilege accounts paying genuine best buy savings rates.

baby_boomer

Britannia has just won a victory over the Revenue.

Accountancy Age - Britannia win's tax reprieve for bonuses on ISAs and children's accounts

Previously the bonus was taxable, but Britannia is getting it tax free for these accounts tax free accounts.

Still not as good as getting it added to your ISA, though, where it could have continued to accrue tax free.

And how do you enter it on your tax return ?

And the bonus scheme remains wasteful for mortgage holders who continue to pay unnecessary tax on their bonus at their top rate .

bristolleedsfan

baby_boomer wrote: »

And how do you enter it on your tax return ?

if brittanias bonus payments are considered non taxable on the accounts mentioned then they wont need to be included on tax returns in the same way as ISA interest isnt required to be entered on tax returns.

steady__eddie

Just a general moan and not a deliberate attempt to hijack the thread but if a loyalty bonus i.r.o. I.S.A. s is tax free, then why aren't windfall payments which are generated solely by the member holding an I.S.A. also tax free ?
I have raised this point with H.M.R.C. on a couple of occasions in the past and their stock response was, "Because they aren't" :mad:

ramborai1987

I suggest you dont transfer catlover, you get a members bonus each year because you've been a long term member. my mum has a fixed rate isa at 6% which is not available anymore and she gets a hefty bonus ontop because she has been with them for many years. even if she had to transfer it to a variable rate 5.5% britannia next year her members bonus added will still mean she will be competing with a high rate one like the 6.3% nsi isa.

i dont know if this applies to you but since you have accumalated 9000 over a number of years its worth working out if the members bonus + int rate is competing against one of the higher ones. remember if you switch you will have to accumalate your bonus again.

bristolleedsfan

steady__eddie wrote: »

Just a general moan and not a deliberate attempt to hijack the thread but if a loyalty bonus i.r.o. I.S.A. s is tax free, then why aren't windfall payments which are generated solely by the member holding an I.S.A. also tax free ?
I have raised this point with H.M.R.C. on a couple of occasions in the past and their stock response was, "Because they aren't" :mad:

i would imagine other financial providers will now be asking H.M.R.C the same question.