Fixed Cash ISA Now Worth While?

Noneforit999

Hi

Assuming you have used your personal allowance (I have), it looks like Virgin Money are offering 3.5% on a 1 year fixed rate Cash ISA and the best non ISA 1 year fixed is around 4% so for me the Cash ISA 1 Year fixed is the best option for £20k of my money right?

I am transferring some to my Wife as she is a lower rate tax payer so has the £1000 allowance but I am higher rate and have used my £500 already. 

Thanks

Bigwheels1111

The best rate for 1 year is Shawbrook 3.7%

Untick the box top right

https://moneyfacts.co.uk/isa/fixed-rate-isas/?quick-links-first=false

Dazed_and_C0nfused

Noneforit999 said:

Hi

Assuming you have used your personal allowance (I have), it looks like Virgin Money are offering 3.5% on a 1 year fixed rate Cash ISA and the best non ISA 1 year fixed is around 4% so for me the Cash ISA 1 Year fixed is the best option for £20k of my money right?

I am transferring some to my Wife as she is a lower rate tax payer so has the £1000 allowance but I am higher rate and have used my £500 already. 

Thanks

What about the savings starter rate?  She has to use that before the savings nil rate (aka Personal Savings Allowance) comes into play.

If her taxable earnings/pension is less than £17,570 she is likely to have starter rate band available.

Noneforit999

Dazed_and_C0nfused said:

Noneforit999 said:

Hi

Assuming you have used your personal allowance (I have), it looks like Virgin Money are offering 3.5% on a 1 year fixed rate Cash ISA and the best non ISA 1 year fixed is around 4% so for me the Cash ISA 1 Year fixed is the best option for £20k of my money right?

I am transferring some to my Wife as she is a lower rate tax payer so has the £1000 allowance but I am higher rate and have used my £500 already. 

Thanks

What about the savings starter rate?  She has to use that before the savings nil rate (aka Personal Savings Allowance) comes into play.

If her taxable earnings/pension is less than £17,570 she is likely to have starter rate band available.

Struggling to get my head round the starter rate.

Her salary is £16800 total, no other income than savings interest which is about £300 a year at the moment.

Dazed_and_C0nfused

Depending on how she contributes to her pension her salary may well be irrelevant, it's taxable pay that counts, the amount which will be on her P60.

But let's say that's £16,800 and she's got the standard emergency tax code of 1257L.

She will be paying tax on £4,230 of her earnings meaning she has £770 of the savings starter rate band left to use (£5,000 less £4,230 = £770).

And that must be used before the £1,000 savings nil rate can be used.

So she could have £1,770 in interest (all taxed at 0%) before she had any tax to pay on it.