Can I save in my wife's account?

Sea_Shell

Doubleshotdamo said:

SVaz said:

Presumably you have a joint account?
She would open her own savings,  you would fund it via the joint account. 

The majority of our savings are in my Wife’s name because she’s not a tax payer.  

Yes, we have a joint account, which is basically a bills account where my salary gets paid and which I use as s personal account. She has her own current account, but does not save. 

Does she not save, as she has no spare income, or that she spends whatever she can get her hands on 

Only you can know whether putting savings in her name will be "safe" and not thought of as "ooh spare cash" !!

If she can be trusted with access to savings, then from a tax POV it's a no brainer.  

Alternatively, if you can lock some away, she could open a fixed term account(s) and put some in that, then she wouldn't have access to it, day to day. 

worriednoob

Sorry for jumping on this thread, can someone please clarify the below for me?

If my spouse is earning £7k pa and has given her marriage tax allowance to me (I'm a basic-rate taxpayer), how much can they still earn in salary and interest?  Also what if they are also getting certain benefits, such as child-benefit or carers allowance?

SVaz

The 1 year NS&I 6.2% account seems the obvious choice.   

 I’ve just had an investec bond mature and that cash has now gone into my Wife’s name with the above account as I’m getting close to the £1k limit.  

xylophone

If my spouse is earning £7k pa and has given her marriage tax allowance to me (I'm a basic-rate taxpayer), how much can they still earn in salary and interest?  Also what if they are also getting certain benefits, such as child-benefit or carers allowance?

Child Benefit - see link - non taxable in your/her circumstances.

Carer's Allowance is a taxable benefit.

https://www.gov.uk/income-tax/taxfree-and-taxable-state-benefits

Your wife's  PA is reduced to  £11,310.

Let's say that her salary plus CA comes to £10,000 a year.

She can earn up to £1,310 in interest tax free.

On top of that, she can make use of the Starter rate for savings therefore up to another £5000 in savings interest tax free.

On top of that, she can make use of the Personal Savings Allowance therefore up to another £1000 in savings interest tax free.

https://www.moneyhelper.org.uk/en/savings/types-of-savings/tax-on-savings-and-investments

handful

SVaz said:

The 1 year NS&I 6.2% account seems the obvious choice.   

 I’ve just had an investec bond mature and that cash has now gone into my Wife’s name with the above account as I’m getting close to the £1k limit.  

I've just done the same with my wife with the 6.2% bond after finding out about the £5k starter saving rate on here!

Albermarle

worriednoob said:

Sorry for jumping on this thread, can someone please clarify the below for me?

If my spouse is earning £7k pa and has given her marriage tax allowance to me (I'm a basic-rate taxpayer), how much can they still earn in salary and interest?  Also what if they are also getting certain benefits, such as child-benefit or carers allowance?

To be pedantic, she can earn as much salary and interest as she is able to, but I presume you mean how much can she earn before paying tax .
So in addition to the info from @xylophone, she can also save £20K pa into a cash ISA ( as can you of course) with no tax on interest.

worriednoob

xylophone said:

If my spouse is earning £7k pa and has given her marriage tax allowance to me (I'm a basic-rate taxpayer), how much can they still earn in salary and interest?  Also what if they are also getting certain benefits, such as child-benefit or carers allowance?

Child Benefit - see link - non taxable in your/her circumstances.

Carer's Allowance is a taxable benefit.

https://www.gov.uk/income-tax/taxfree-and-taxable-state-benefits

Your wife's  PA is reduced to  £11,310.

Let's say that her salary plus CA comes to £10,000 a year.

She can earn up to £1,310 in interest tax free.

On top of that, she can make use of the Starter rate for savings therefore up to another £5000 in savings interest tax free.

On top of that, she can make use of the Personal Savings Allowance therefore up to another £1000 in savings interest tax free.

https://www.moneyhelper.org.uk/en/savings/types-of-savings/tax-on-savings-and-investments

Albermarle said:

worriednoob said:

Sorry for jumping on this thread, can someone please clarify the below for me?

If my spouse is earning £7k pa and has given her marriage tax allowance to me (I'm a basic-rate taxpayer), how much can they still earn in salary and interest?  Also what if they are also getting certain benefits, such as child-benefit or carers allowance?

To be pedantic, she can earn as much salary and interest as she is able to, but I presume you mean how much can she earn before paying tax .
So in addition to the info from @xylophone, she can also save £20K pa into a cash ISA ( as can you of course) with no tax on interest.

Thanks so much @xylophone and @Albermarle

Yes, I want to know how much she can earn and save before she needs to pay tax.  So just to be clear, (leaving out cash ISA) based on her circumstances, unless she earns around £7K+ pa in interest, then she's not going to have to pay any tax?

xylophone

based on her circumstances, 

First take her annual salary.  Add her CA . This is non savings/non dividend income.

Deduct the total from her PA (which  is reduced to £11,310 because of the marriage allowance.)

If the PA is higher than the  total non savings/non dividend income, the difference between the two can be set against her savings interest and that amount of interest is tax free.

Then she can earn up to another £6000 tax free interest (Starter Rate for Savings + Personal Savings Allowance).

worriednoob

xylophone said:

based on her circumstances, 

First take her annual salary.  Add her CA . This is non savings/non dividend income.

Deduct the total from her PA (which  is reduced to £11,310 because of the marriage allowance.)

If the PA is higher than the  total non savings/non dividend income, the difference between the two can be set against her savings interest and that amount of interest is tax free.

Then she can earn up to another £6000 tax free interest (Starter Rate for Savings + Personal Savings Allowance).

Thanks so much. So is this calculation correct?

£7,000 SAL + £4,000 CA  = £11,000

£11,310 - £11000 = £310

£310 + £6000 = £6310 is the total interest she can earn before getting taxed?

Really appreciate it

Albermarle

worriednoob said:

xylophone said:

based on her circumstances, 

First take her annual salary.  Add her CA . This is non savings/non dividend income.

Deduct the total from her PA (which  is reduced to £11,310 because of the marriage allowance.)

If the PA is higher than the  total non savings/non dividend income, the difference between the two can be set against her savings interest and that amount of interest is tax free.

Then she can earn up to another £6000 tax free interest (Starter Rate for Savings + Personal Savings Allowance).

Thanks so much. So is this calculation correct?

£7,000 SAL + £4,000 CA  = £11,000

£11,310 - £11000 = £310

£310 + £6000 = £6310 is the total interest she can earn before getting taxed?

Really appreciate it

That is correct.