certIncome from ISA's andificates and tax/benefits

merlinthehappypig

Not sure if this should be on the benefit board or this one.

I'm trying to sort out my sister's savings as her partner has recently died.

At present all her savings are in normal building society accounts. She has a part-time job and gets child and working tax credit. Any interest that she gets gets counted as income and reduces her tax credits.

I appreciate that the interest from an ISA is tax-free, but I'm not sure whether or not the interest from that can be ignored as well when declaring income for benefits.

Likewise what about Index-linked National Savings Certificates? The return on these is free of tax, I understand that, but I read somewhere that the 'index linked' bit doesn't count as income, just the 1.5% or so that is 'interest'. Again if anyone can clarify what, if any, would need to be declared as income for benefit purposes I'd appreciate it.

She doesn't have a huge amount of money, but I just want to ensure that she keeps as much of it as possible as she has no chance of saving any more as things stand.

She doesn't need to touch the money in the mdium term so can tie it up.

Any advice appreciated.

merlinthehappypig

I've re-posted this with the correct title and have asked the mods to delete this thread. Thanks