Coventry maturing bond question

gele

I have a bond maturing at the end of this month and an interesting maturity offer from Coventry. A new 3 year bond paying 6.05%. That sounds pretty good to me. Interest is paid annually or monthly as opposed to on maturity but I was wondering if someone could tell me how much I could put in this bond at this rate of interest before I would be subject to paying tax. 
Thanks. 

AntoMac

It will depend to a large extent whether you are a basic rate or a higher rate tax payer. The below link should give you what you need
https://www.gov.uk/apply-tax-free-interest-on-savings

gele

Sorry, I should have said. Basic rate. I'll check out the link though. Thanks

35har1old

gele said:

Sorry, I should have said. Basic rate. I'll check out the link though. Thanks

Assuming that your income has exceeded the threshold and you are only able to claim the £1000 tax free amount approx 16500

[Deleted User]

Hi,

even if you do have to pay tax, you will still get 4.84%.

Say your Coventry money exceeds the £16500 mentioned above, what will you do with the rest of it, stick it in a lesser interest paying account and still have to pay tax?

Have you done an ISA yet this year, or maybe try Premium Bonds, both tax free.

gele

Thanks for the replies. Like many now, because of the jump in interest rates I am having to consider things more carefully. I haven't done an Isa yet but am planning opening one this month too. This bond money was initially destined for the Isa but 6.05% over 3 yrs is a real tempter for me which is why I needed a figure to work around. I have a couple of small bonds maturing later this year so I'm now thinking of a Shawbrook ISA I can add to ad hoc for those. I never thought I'd have tax on interest to think about but I suppose its a nice 'problem' to have.

tetrarch

gele said:

I have a bond maturing at the end of this month and an interesting maturity offer from Coventry. A new 3 year bond paying 6.05%. That sounds pretty good to me. Interest is paid annually or monthly as opposed to on maturity but I was wondering if someone could tell me how much I could put in this bond at this rate of interest before I would be subject to paying tax. 
Thanks. 

Can you post a link to this product?

This is a good rate, but doesn't appear on their website under savings products AFAICT

Regards

Tet

badger09

tetrarch said:

gele said:

I have a bond maturing at the end of this month and an interesting maturity offer from Coventry. A new 3 year bond paying 6.05%. That sounds pretty good to me. Interest is paid annually or monthly as opposed to on maturity but I was wondering if someone could tell me how much I could put in this bond at this rate of interest before I would be subject to paying tax. 
Thanks. 

Can you post a link to this product?

This is a good rate, but doesn't appear on their website under savings products AFAICT

Regards

Tet

OP said the 6.05% rate was in Coventry’s maturity letter. Sometimes institutions offer slightly better rates to customers with maturing products than to the general public. 

SaveTheEuro

tetrarch said:

gele said:

I have a bond maturing at the end of this month and an interesting maturity offer from Coventry. A new 3 year bond paying 6.05%. That sounds pretty good to me. Interest is paid annually or monthly as opposed to on maturity but I was wondering if someone could tell me how much I could put in this bond at this rate of interest before I would be subject to paying tax. 
Thanks. 

Can you post a link to this product?

This is a good rate, but doesn't appear on their website under savings products AFAICT

Regards

Tet

I have had the same offer. It is only available to customers with a maturing bond. 

trickydicky14

Yes it's for maturing accounts only I just had the offer, I decided not to take it as I want to put all my cash into my NatWest 2 year ISA @ 5.9%. Seeing how hard it was to set up I can't turn it down at that rate.

[Deleted User]

Hi,

gele said:

I haven't done an Isa yet but am planning opening one this month too.

You can only put 20K a year into an ISA, though if you have a wife/husband/partner you can have one each.

Probably won't get as good an interest rate, so you'll need to work out if paying the tax is a better option.