Help!! HMRC randomly dipped in and took 1/4 of my wages

Bobziz

Flugelhorn said:

brutal_deluxe said:

Bobziz said:

There's potentially another elephant in the room, which is why you have so much cash in savings accounts? What do you plan to use the money for ? 

It's my life savings to be used as a deposit for a house

maybe @Bobziz thinks you should be investing rather than saving in cash. It is up to you how you save it - mine is all cash, have been bitten by investing twice now, enough is enough 

No, given the intended purpose of the money, savings accounts are perfect in my view. 

Presumably your savings will be put to use in the short term too? If not then the consensus seems to be that for anything over 5 years then investing at least some of it will likely provide a better return. 

MeteredOut

Flugelhorn said:

brutal_deluxe said:

Bobziz said:

There's potentially another elephant in the room, which is why you have so much cash in savings accounts? What do you plan to use the money for ? 

It's my life savings to be used as a deposit for a house

maybe @Bobziz thinks you should be investing rather than saving in cash. It is up to you how you save it - mine is all cash, have been bitten by investing twice now, enough is enough 

I'd suggest this week is very much not a good time to start investing money that is intended for a house deposit.

poseidon1

MeteredOut said:

Flugelhorn said:

brutal_deluxe said:

Bobziz said:

There's potentially another elephant in the room, which is why you have so much cash in savings accounts? What do you plan to use the money for ? 

It's my life savings to be used as a deposit for a house

maybe @Bobziz thinks you should be investing rather than saving in cash. It is up to you how you save it - mine is all cash, have been bitten by investing twice now, enough is enough 

I'd suggest this week is very much not a good time to start investing money that is intended for a house deposit.

Fundamentally, should anyone who cannot differentiate between an Individual Saving Account ( tax free ) and an instant access saving accounts ( taxable ) even contemplate investing in the markets?

Investing requires a whole other level of financial lliteracy skills and competency that does not seem evident here. OP best stick to cash ISAs ( ie tax free individual savings accounts )  going forward now he has a proper understanding of what they are.

MeteredOut

poseidon1 said:

MeteredOut said:

Flugelhorn said:

brutal_deluxe said:

Bobziz said:

There's potentially another elephant in the room, which is why you have so much cash in savings accounts? What do you plan to use the money for ? 

It's my life savings to be used as a deposit for a house

maybe @Bobziz thinks you should be investing rather than saving in cash. It is up to you how you save it - mine is all cash, have been bitten by investing twice now, enough is enough 

I'd suggest this week is very much not a good time to start investing money that is intended for a house deposit.

Fundamentally, should anyone who cannot differentiate between an Individual Saving Account ( tax free ) and an instant access saving accounts ( taxable ) even contemplate investing in the markets?

Investing requires a whole other level of financial lliteracy skills and competency that does not seem evident here. OP best stick to cash ISAs ( ie tax free individual savings accounts )  going forward now he has a proper understanding of what they are.

Agreed, and someone with that level of financial experience would likely panic given the volatility we're likely to see in the market in the short (and perhaps medium) term.

brutal_deluxe

I wouldn't even contemplate investing in the markets. I just wanted somewhere to put my capital until I find a house, hence easy access "ISAs". I did little to no research as anything was better than having it floating around in my bank accounts with practically no interest return.

LL_USS

@brutal_deluxe hope you can sort out the problem soon.

I once had a sudden change in my tax code (for a different reason - HMRC saw I had a payment in from another university, which was only once a year for some work I do as an external for them, but HMRC assumed I had that same amount of second income every month). I asked my work and they gave me this number 0300 200 3300 and I called HMRC and the problem was sorted in 15 minutes as I confirmed to them it was a once-a-year pay and taxed from source.

I found it easiest to call and ask HMRC what happened to my tax code (and had it fixed - overpaid tax that month was paid back in my next month's pay)

It seems you have a sense of what happened already but still good to have the confirmation from them to know what happened and avoid similar problems in the future.

As for where to park your money whilst searching for a house, just some easy accessed cash ISA (even one that the rate only drops after a couple of withdrawals, as it would seem you'll only withdraw once when you get the house purchase affair in place to move forward). If it's over the 20K/year ISA allowance then the rest in normal saving accounts with highest rates you can find, and if the total interest outside of ISA is over your allowance then just declare and pay tax on it.

Good luck !