Savings interest pushing into higher rate tax

cfip123

Hi there, hoping someone can advise. 
I currently have savings in any easy access, with interest paid monthly, where the interest will be over the £1000 allowance, and where it is likely it is going to push me into a higher rate tax bracket as well. 
If I were to move my savings from current easy access, to a 90 day notice account, and not apply to access until say June next year, would this allow me to stay under the £50k higher tax bracket? I.e any interest once i change accounts won't be counted until i activate the 90 day notice? Many thanks in advance 

Swipe

Yes you could defer the payment of interest into the next tax year or alternatively pay some money into a pension (but you'd have to make HMRC aware of that if you don't do self assessment).

km1500

just to check - have you used tax free savings eg isa and premium bonds

surreysaver

Is there any salary sacrifice scheme where you work (pension/shares/ anything else) that could bring your taxable pay down?

ColdIron

cfip123 said:

would this allow me to stay under the £50k higher tax bracket?

It's £50,270 if that helps

If you creep into the high rate bracket your PSA reduces to £500

cfip123

km1500 said:

just to check - have you used tax free savings eg isa and premium bonds

Yes have isa in place already 

cfip123

ColdIron said:

cfip123 said:

would this allow me to stay under the £50k higher tax bracket?

It's £50,270 if that helps

If you creep into the high rate bracket your PSA reduces to £500

Yeah that's what I'm worried about, as it could be borderline but think it'll push me over and reduce the PSA

cfip123

surreysaver said:

Is there any salary sacrifice scheme where you work (pension/shares/ anything else) that could bring your taxable pay down?

Possibly an option, will need to look Into and see. Thanks!

cfip123

Swipe said:

Yes you could defer the payment of interest into the next tax year or alternatively pay some money into a pension (but you'd have to make HMRC aware of that if you don't do self assessment).

Interesting re pension, didn't know that was an option! Think for right now, if the 90 day notice will work and just allow me to move interest from this year to next year that is my best option right now 

ColdIron

Sounds like a pension contribution would solve the threshold and PSA problem

Whatever you put into the pension (gross) would raise the £50,270 by the same amount and you get some tax relief. What's not to like?

EthicsGradient

You could also find, if you want, another instant access account which pays interest annually rather than monthly, and that would also move the date you receive that interest into the next tax year. With a 90 day notice account, it's not when you make a withdrawal that will determine when the interest is paid (unless you close it entirely), it is, again, whether the account pays monthly or annually (or quarterly, as I see one does).