Personal Allowance & Savings Interest

Dazed_and_C0nfused

art123_2 said:

Earnings £11,000 Pension £3,500

In that case she has £3,070 of the savings starter rate band available.

And once that is used she can use the £1,000 savings nil rate band.

Receiving Marriage Allowance makes no difference to her as far as the rate bands are concerned.  

But whatever her total tax liability is she can then knock off £252 as a result of receiving Marriage Allowance.

So on her £14,500 earnings/pension her tax liability would be £386 but after the Marriage Allowance tax credit she only actually needs to pay £134.

art123_2

Thank you very much for your detailed response Dazed and confused, it's much appreciated.  

The only thing now is for us to make sure we get annual interest rather than interest on maturity with any 2 year fixed rate bonds, to avoid 2 years of interest being lumped into 1 tax year

where_are_we

"wtiasa1997" - if have reached the age of 55, have no earned income, you can benefit immensely by annually putting £2880 into a SIPP (I have used Hargreaves Landsdown in the past) and once HMRC have added £720 tax relief (usually around 6 weeks) you are free to withdraw the £3600 balance (if you use H-L best to withdraw £3550 to leave £50 to keep the SIPP running each year) tax free. You can do this up to age 75. More details on the "Pension" forum.