Inheritance

fiddlyfithompson

I will be inheriting £60000. I can add £4000 approx into existing isa but where is best place to put balance bearing in mind that I would like to avoid paying the least in tax? I am self-employed and part-time employed by council. I understand that I can only put in to work pension amount earned in year which is around £3000. Would I be better off to take out another pension. Worried about earnings from savings.
Thank you

ajbell

You want to pay more tax?

AnotherJoe

fiddlyfithompson wrote: »

I will be inheriting £60000. I can add £4000 approx into existing isa but where is best place to put balance bearing in mind that I would like to avoid paying the least in tax? I am self-employed and part-time employed by council. I understand that I can only put in to work pension amount earned in year which is around £3000. Would I be better off to take out another pension. Worried about earnings from savings.
Thank you

Assuming you actually mean you'd like to pay the least tax (not avoid paying the least tax !) , I suggest your aim should instead be to maximise how much you get after tax.
After all if you put it in an account that paid 0%, you'd pay no tax, which is the simple but wrong answer to your question.

Better to put it in an account that earned say 2%, which in one year is £1,200. Even if you paid 20% tax on the £1200 it would only be 20% of £200 (since the first £1k is tax free) so you'd still get £1,160. Which is better than paying no tax but getting nothing else.

xylophone

Are you a member of LGPS?

How much will you pay in pension contributions (presumably deducted from salary before tax is deducted) in this tax year?

Do you also have a private pension?

What are your total annual earnings from your council job?

And from self employment?

How old are you?

Have you obtained a state pension forecast?

https://www.gov.uk/check-state-pension