3% ish Easy Access... At Vanguard!

ColdIron

Qyburn said:

Altior said:

Currently we keep the first 0.20% of the interest we receive, to cover our costs.

Do they also charge the platform fee (0.15%) on the cash balance?

Read the link in the OP for a full breakdown and explanation

masonic

lindabea said:

Something to bear in  mind is that Vanguard (unlike banks) DO NOT notify HMRC of any interest received from funds  in the cash account.  So you will need to tell HMRC if you received any interest (from Non ISA accounts) although the amount will be shown on the tax voucher. 

Are you sure about that? Most investment providers seem to report income received from investments (including interest distributions), so it would be surprising if interest on uninvested cash were an exception. It is good practice in any case if you have a tax liability to check everything with HMRC to ensure their records are correct.

AndyTh_2

hallmark said:

lindabea said:

Something to bear in  mind is that Vanguard (unlike banks) DO NOT notify HMRC of any interest received from funds  in the cash account.  So you will need to tell HMRC if you received any interest (from Non ISA accounts) although the amount will be shown on the tax voucher. 

Presumably no need to tell HMRC about any interest on cash held in SIPPs either?

That's right, interest is tax free in ISAs and SIPPs, and shouldn't be reported.

NedS

gee9fam said:

I appreciate the lack of risk (excluding inflation) with cash sat in an ISA/SIPP account earning a small amount of interest but what's the positives and negatives using a short term money market account instead such as the Royal London Short term Money Market account for platforms not offering a decent rate?

Exactly, money market funds are also now returning close to BoE base rates (less fees) so offer a viable alternative at very low risk for platforms which are not paying decent interest rates on cash holdings.

I've started a thread to discuss cash options for those not on Vanguard here:

https://forums.moneysavingexpert.com/discussion/6421073/where-to-hold-cash-in-a-sipp-or-s-s-isa

DanJ90

Is this still the same for the Vanguard GIA also? Or is this essentially treated as an easy access account subject to the £500/1000 annual savings limit before tax is due? 

NedS

DanJ90 said:

Is this still the same for the Vanguard GIA also? Or is this essentially treated as an easy access account subject to the £500/1000 annual savings limit before tax is due? 

The payment is classified as interest, so will be treated the same as any other interest payment regardless of what account it is paid from. SIPPs and ISAs are tax free, all other accounts it will be treated as a taxable interest income which should be declared and taken into account if required to compete a tax return.

RogerPensionGuy

https://www.willisowen.co.uk/deposit/tax-on-your-savings
.

I guess Vanguard will update HMRC of interest earned if reqd and it will affect personal tax codes, yes?

Tugboat

I have recently cashed out 16k of investments to cash in my Vanguard ISA, if left this cash will accrue 3% interest and be paid monthly?

This is a bit of bonus while I dither on what to do with it.

RogerPensionGuy

Tugboat said:

I have recently cashed out 16k of investments to cash in my Vanguard ISA, if left this cash will accrue 3% interest and be paid monthly?

This is a bit of bonus while I dither on what to do with it.

Currently 3.1% I think and if BOE puts the base rate to 4% this week, nearer 3.6% you will get I think.
.
https://moneytothemasses.com/owning-a-home/interest-rate-forecasts/latest-interest-rate-predictions-when-will-rates-rise#:~:text=The market is predicting that,jump as high as 5.4%.

PParka

I was about to transfer some of my Vanguard S&S ISA into a cash ISA, but it looks like I might as well leave it as cash in my Vanguard account.

At least it means I will have one less account to keep track of, as I'm trying to simplify things as I approach early retirement.  Also, the Vanguard ISA is flexible, so I can replace any money I withdraw.

Are Vanguard likely to question why there is a large-ish cash balance in an investment account?