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Tax on fixed rate bond

Bobziz
Posts: 652 Forumite

Hi,
So another tax on interest question - Is it possible to pay tax annually on a Nationwide 3 year fixed rate bond where the interest is only paid into the account and is not accessible until maturity? It's my understanding that tax would only become due only when the bond matures. However, as interest is paid annually this would presumably generate an annual interest statement. I would like to pay tax annually to prevent being pushed into the higher rate on maturity.
Many thanks.
So another tax on interest question - Is it possible to pay tax annually on a Nationwide 3 year fixed rate bond where the interest is only paid into the account and is not accessible until maturity? It's my understanding that tax would only become due only when the bond matures. However, as interest is paid annually this would presumably generate an annual interest statement. I would like to pay tax annually to prevent being pushed into the higher rate on maturity.
Many thanks.
1
Comments
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The consensus seems to be that, in terms of tax, it's when Nationwide reports the interest to HMRC that is key rather than when you can actually access it and this may indeed be annually, if that's when the interest is paid into the account. It might be worth contacting Nationwide to get the official answer ?1
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refluxer said:The consensus seems to be that, in terms of tax, it's when Nationwide reports the interest to HMRC that is key rather than when you actually receive it and this may indeed be annually, if that's when the interest is paid into the account. It might be worth contacting Nationwide to get the official answer ?1
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I’m quitting work at the end of this year for good
So after that I won’t receive any income from work and won’t receive any benefits of any kind either
next year, I will receive just over £5000 in savings interest from fixed savings bonds , that mature in July , October and November
will I have to pay any tax on this £5000+ ?
0 -
ranciduk said:I’m quitting work at the end of this year for good
next year, I will receive just over £5000 in savings interest from fixed savings bonds , that mature in July , October and November
will I have to pay any tax on this £5000+ ?
In the tax year from 6 April 2023 to 5 April 2024 what other taxable income will you have on top of the £5,000 interest?0 -
Absolutely nothing
not a penny0 -
ranciduk said:I’m quitting work at the end of this year for good
So after that I won’t receive any income from work and won’t receive any benefits of any kind either
next year, I will receive just over £5000 in savings interest from fixed savings bonds , that mature in July , October and November
will I have to pay any tax on this £5000+ ?1 -
ranciduk said:Absolutely nothing
not a penny
You will use £5,000 of your Personal Allowance and have no tax liability.
This has got nothing whatsoever to do with either the savings starter rate of savings nil rate (aka Personal Savings Allowance), you are not paying any tax be sure your income falls within your Personal Allowance.
You could actually have another £10k+ interest and still not have any tax to pay.1 -
Excellent thanks guys
yep sorry I have asked this on another thread a while back
but I keep reading conflicting info on the internet!
plus, due to recent rises in interest rates, I’m gonna be earning more interest from bonds than I was expecting a few months back
appreciate your time and help 👍0 -
refluxer said:The consensus seems to be that, in terms of tax, it's when Nationwide reports the interest to HMRC that is key rather than when you can actually access it and this may indeed be annually, if that's when the interest is paid into the account. It might be worth contacting Nationwide to get the official answer ?1
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Bobziz said:refluxer said:The consensus seems to be that, in terms of tax, it's when Nationwide reports the interest to HMRC that is key rather than when you can actually access it and this may indeed be annually, if that's when the interest is paid into the account. It might be worth contacting Nationwide to get the official answer ?1
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