Extra 2% on savings ?

Heytheremrblue

What does that mean ?

QrizB

Heytheremrblue said:

What does that mean ?

Some context might help?

eskbanker

Once beyond the various allowances, savings interest will be taxed at 22%, 42% or 47% rates, rather than the alignment with other income that currently applies.

wmb194

Heytheremrblue said:

What does that mean ?

We don't have the actual budget document yet but it appears to be;

From April 2026, a 2 percentage point increase to the basic and higher rates of tax on dividends, raising them to 10.75 and 35.75 per cent respectively. 

From April 2027, a 2 percentage point increase to the basic, higher and additional rates of saving income tax, increasing them to 22, 42 and 47 per cent respectively. 

Heytheremrblue

Thanks guys

Swipe

I'll be deferring my SIPP draw down then in that case.

Heytheremrblue

I’ll be making absolutely sure I stay under my PSA limits ! 

surreysaver

Heytheremrblue said:

I’ll be making absolutely sure I stay under my PSA limits ! 

Still depends whether I earn more after tax than in an ISA. Just changes the calculation. Can't see it making much difference, but there will be more borderline cases of whether an ISA will be better. Depending upon what happens to ISA limits...

ColdIron

Scotland's 'basic' rate(s) of tax (19%, 20% and 21%) will now be less than England's. Who would have thunk that the SNP was the party of low tax for 'working people'? 

vacheron

Swipe said:

I'll be deferring my SIPP draw down then in that case.

Just put £20K of the cash in your ISA each year...... oh! 

eskbanker

ColdIron said:

Scotland's 'basic' rate(s) of tax (19%, 20% and 21%) will now be less than England's. Who would have thunk that the SNP was the party of low tax for 'working people'? 

But only for income from savings, dividends and property (which were already taxed at the UK rates rather than the Scottish ones)?