📨 Have you signed up to the Forum's new Email Digest yet? Get a selection of trending threads sent straight to your inbox daily, weekly or monthly!

Does bank interest gets added to your income which dictates your tax bracket and PA?

Options
2»

Comments

  • Spir4
    Spir4 Posts: 84 Forumite
    Sixth Anniversary 10 Posts
    Spir4 said:
    Spir4 said:
    I was referring to taxable interest indeed, but I didn't think of ISA interest, so you make an interesting point.

    So say in Scenario 1, if that interest was from an ISA, your total income would be seen as £100,000 and your PA wouldn't get reduced? You get the £500 without any implications at all?
    You've lost me there 😕

    If you have income from employment of £100,000 what use is the £500 savings nil rate band 🤔

    Scenario 1:
    Your income from employment is £100,000
    So your income from employment is £100,000, that's your total income. You've got £500 interest from an ISA, which  doesn't get added to your employment income to get to your total income. You're total income is still £100,000. If that £500 was interest from a normal savings account, then it would get added.

    Thanks Bookworm105 for confirming!
    If your only taxable income is £100,000 then you aren't into tapered Personal Allowance territory in the first place.  

    If your adjusted net income is £100,500 then you will lose £250 of your Personal Allowance.
    Yes, but my question was about what gets added to your adjusted net income. Interest from a savings account does, interest form an ISA doesn't! So that's all cleared up, thanks everyone for your help!
Meet your Ambassadors

🚀 Getting Started

Hi new member!

Our Getting Started Guide will help you get the most out of the Forum

Categories

  • All Categories
  • 351.2K Banking & Borrowing
  • 253.2K Reduce Debt & Boost Income
  • 453.7K Spending & Discounts
  • 244.2K Work, Benefits & Business
  • 599.3K Mortgages, Homes & Bills
  • 177K Life & Family
  • 257.6K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 16.2K Discuss & Feedback
  • 37.6K Read-Only Boards

Is this how you want to be seen?

We see you are using a default avatar. It takes only a few seconds to pick a picture.