Savings interest

mummy72

Apologies if this is in the wrong forum, I need some help to clarify interest on savings and how much I can receive before I pay tax on it.

My situation - I don't work as I am a carer, so receive carers allowance weekly, have done the marriage allowance transfer to my husband.

We have some savings and they are earning interest, I just want to be clear on how much I have each year that would be tax free from a mix of CA, savings interest. I also sell on vinted and do surveys.

Savings are mostly in my name.

Many thanks

Dazed_and_C0nfused

https://forums.moneysavingexpert.com/discussion/6666985/savings-interest

How much do you expect your trading profits to be (bunged, surveys etc) and how much taxable Carers Allowance do you think you'll get?

Bigwheels1111

£18,570.00 - £4,495.40 - £1,260 = £12,814.60.

Personal allowance minus carers, minus marrage allowance = £12,814.60 tax free interest as such.

If you get over 10k interest you will need to file a self assessment return.

Everything up to £18,570 in total will be tax free.

eskbanker

If you've transferred the marriage allowance to your husband, then your adjusted personal allowance is £11,310, and on top of that you may be able to benefit from the starting savings allowance of up to £5,000, depending on the breakdown of your income, plus the personal savings allowance of £1,000.

It's explained here:

https://www.moneysavingexpert.com/savings/tax-free-savings/

Are you making use of ISAs for any of your savings?

LITRG

Hi OP. You may find the tax on savings pages of our website useful.

Tax on savings income | Low Incomes Tax Reform Group

Specifically, the page on the starting rate for savings may be particularly helpful.

Starting rate for savings | Low Incomes Tax Reform Group

It's important to note that carer's allowance is a taxable benefit and still uses up part of the personal allowance.

mummy72

Hi, many thanks for the replies and links.

https://forums.moneysavingexpert.com/discussion/comment/81987298#Comment_81987298

Hi my carers allowance is £4495.40, expecting to earn around £300/400 vinted, surveys £1000. Interest going on last years is approx £6000.

Currently have an old ISA with halifax that I am planning to start to use.

Thank you appreciate the help, I don't mind having to do a return just want to be sure as to what point I needed to.

Albermarle

https://forums.moneysavingexpert.com/discussion/comment/81987366#Comment_81987366

You can earn up to around £12K in interest each year without paying tax.

So no need to bother with ISAs or do a tax return - unless your income increases significantly .

Have a good read of the links supplied in previous posts.

friolento

https://forums.moneysavingexpert.com/discussion/comment/81987366#Comment_81987366

If you do want an ISA (even though it looks you wouldn't immediately or may be ever benefit from one), you don't have to use an old one you already have. It has most likely a miserable interest rate, so it would make sense to open a new one with a better paying rate. If your new ISA accepts transfers in, you should then instruct your new provider to transfer your Halifax ISA.

Also check your NI record to be sure you get the NI credits you are entitled to.

Dazed_and_C0nfused

https://forums.moneysavingexpert.com/discussion/comment/81987366#Comment_81987366

It looks like you're going to have slightly more taxable income than your reduced Personal Allowance of £11,310.

But you will benefit from the savings starter rate band, where up to £5,000 of interest will be taxed at a 0% tax rate. So no tax to pay.

And this won't affect Marriage Allowance, you will still be eligible for that to remain in place.