The Top Easy Access Savings Discussion Area

Bigwheels1111

worriednoob said:

EthicsGradient said:

worriednoob said:

Apologies, I'm not sure if it's the right place to post on here, so it's incorrect, I'm more than happy for mods to move this post.  So just to be clear, this question is not for me.  It's for one of my best friends and their partner.  They are not very tech savvy, so they've asked me to help them. 

So my friend used to work in a full-time job earning good salary.  However around 2 months ago, due to work accident/injury, he quit his full-time job and has gone to a zero-hours contract where he only earns around £5-6k per annum + disability benefits .  But he has also built around £45k in savings due to his previous job salary.  His wife on the other hand is in full-time work and earns around £23k per annum and has saved around £10k.  Other than what's already mentioned, They have no other financial income sources.

What he wants to know is if he were to put the £45k money in savings account, what are the tax implications?  i.e. how much interest would he be allowed to accrue before he would be hit with tax?

Furthermore, does being married mean that any savings built by both himself and his wife would be counted as one or does each individual have their own allowances? i.e, can his wife build a seperate pot of savings because she is allowed her own amount of interest?  If so, how do we calculate how much such allowances are?

Thanks in advance for any help or advice you can give.

I suspect this could depend on what the disability benefits are, and how they're taxed - you may find answers from people familiar with the system in the Benefits & tax credits — MoneySavingExpert Forum . I would guess that the combined amount of benefits and £6k is still less than his wife's salary, in which case it's probably a good idea to have the £45k in his name even if the benefits are taxable. When it's know how much, if any, of his benefits are taxable, we could look at if any of the savings might attract tax - which could be avoided anyway by putting them in a cash ISA.

Thanks for your quick reply EthicsGradient.  He gets PIP (middle-rate) and his wife gets Carers Allowance.  Other than that, they have no other benefits.  I was under the assumption that savings don't affect pip or carers allowance?

PiP is not taxable, carers allowance is taxable.
If you get 6k in earnings, that leaves £12,570 of interest that is tax free. Over 10k means filling out a tax return.

Bigwheels1111

worriednoob said:

Thanks @housebuyer143 and @kaMelo for alerting me to this.  Yes, your absolutely right that she shouldn't be getting Carers Allowance.  I have made them aware of this and she plans to contact the benefits office immediately.  Although it's unintentional as she may not have been aware of it, I explained that she will most likely need to pay the CA back, which she's happy to do so.

The main thing I have learnt is that due to the husband's small amount of earnings, his pip isn't affected and he is save to earn upto around £6k in interest, hence he can continue to build a lot of savings before being taxed.  I've also learnt that his wife has a seperate, albeit smaller allowance of around £1k interest before being taxed.  If I've got any of this wrong, I'd greatly appreciate it if someone could correct me.

Thanks again for all your help.

He can get £12,570 in interest tax free.
With earnings that’s a total of £18,570. No tax payable.

jaypers

Anyone know why Atom are so poor with their Easy Access still only being 3.2%? Not looking after their customers here, unlike Investec who went to 3.51% and then to 3.82% pretty quickly. 

intalex

jaypers said:

Anyone know why Atom are so poor with their Easy Access still only being 3.2%? Not looking after their customers here, unlike Investec who went to 3.51% and then to 3.82% pretty quickly. 

My guess is they tried to prioritise fixed rate funds and gain an early mover's advantage with a 5.10% rate (but Tandem very quickly blew them out of the water on that too)

allegro120

Zaul22 said:

Investec out of the left field there, bet Mr Chip didn't see that one coming. While it's the same rate, I wonder if he might go up a bit just because they are a more well known alternative for the people who don't like Chip. 

I suspect most people who don't like Chip are already not using it.  I've had no issues with Chip so I won't bother opening new IA accounts that offer the same rate. But the offers from Investec and HTB might push other providers to raise their rates and if any no strings attached IAs go above 3.82% Chip will probably best it.  We'll see what happens but I won't be surprised if we'll see IA rates moving more closer to 4% soon.

dgpur

allegro120 said:

Zaul22 said:

Investec out of the left field there, bet Mr Chip didn't see that one coming. While it's the same rate, I wonder if he might go up a bit just because they are a more well known alternative for the people who don't like Chip. 

I suspect most people who don't like Chip are already not using it.  I've had no issues with Chip so I won't bother opening new IA accounts that offer the same rate. But the offers from Investec and HTB might push other providers to raise their rates and if any no strings attached IAs go above 3.82% Chip will probably best it.  We'll see what happens but I won't be surprised if we'll see IA rates moving more closer to 4% soon.

Investecl make you jump the unnecessary ID documents hurdle. Don’t have, so can’t open. But I doubt others (especially Chip) are going to ignore it.

happybagger

Investec require a smartphone so that was out for me. HTB suits me nicely. Also opened the Hanley account as I can manage my cash well enough to make do with the withdrawal restrictions

ircE

Maybe @soulsaver intentionally excluded these from the ToTP thread, but in case it helps some people, these accounts are also offering top rates:

Hanley Economic BS' Branch Saver @ 4.50% (note the faff)

West Bromwich BS' Double Access Account @ 3.85%

My Community Finance's Easy Access Account @ 3.83% (min £20k)

Eirambler

Investec is looking good for me, not a company I have used before but at 3.82% my first deposit has gone in seamlessly and I'm up and running - ID checks seemed unnecessary but only took five minutes.

10_66

Re Hampshire Easy Access.  I see that they say payments into their account are credited the day they receive funds, if sent before 1pm, but does anyone have any experience of when withdrawals are received into nominated account, please?