Tax on fixed savings accounts

masonic

Albermarle said:

I'm not aware of any fixed term accounts that permit withdrawals (other than those that are cash ISAs and must permit access by law

Fixed term savings accounts from the LLoyds group ( such as Halifax) allow you to close the account with a penalty, in the same way you can close a fixed term ISA. Also First Direct allow you to close their one year fi for a £100 penalty.

Fixed Saver Account | Savings | Halifax ( Open the question ' can I withdraw money?) 

These are the exceptions though.

Thanks, good to know there are a few examples out there. I guess I've not come across these as they are not competitive. There can be no doubt for these accounts interest would be taxed in the tax year it is credited. For a one year account (unless it pays monthly or quarterly), this is unlikely to make a difference.

sheramber

Royal Bank of Scotland, Bank of Scotland, Natwest,  HSBC  all allow you withdraw or close the account early with a penalty.

masonic

sheramber said:

Royal Bank of Scotland, Bank of Scotland, Natwest,  HSBC  all allow you withdraw or close the account early with a penalty.

Interesting. So basically most of the high street banks that rarely if ever appear near the top of the rate tables. Perhaps the access provision is part of the reason why. Whereas, if you take out one of the top paying fixes, you'll almost certainly have no access during the fixed term and be subject to this issue.

But this demonstrates the question about access needs to be asked.

Albermarle

masonic said:

sheramber said:

Royal Bank of Scotland, Bank of Scotland, Natwest,  HSBC  all allow you withdraw or close the account early with a penalty.

Interesting. So basically most of the high street banks that rarely if ever appear near the top of the rate tables. Perhaps the access provision is part of the reason why. Whereas, if you take out one of the top paying fixes, you'll almost certainly have no access during the fixed term and be subject to this issue.

But this demonstrates the question about access needs to be asked.

What seems to happen is that as their fixed rate ISA's have to have a withdrawal facility with a penalty, they just apply the same rules to their non ISA accounts.