Regular savings 7% rate

Legacy_user

I currently save £250 per month (max allowed) in the Halifax Regular Savings account which has a rate of 6%. I also save £250 per month into a credit union account which last year paid interest at 5% gross.
I would like to take advantage of the new 7% rate available from both the Abbey and Halifax but apparently this new Halifax rate doesn't apply to me cos my account was opened before last Saturday and you can't have more than 1 per customer. I don't want to lose any bonus or incur any costs but I would like to take advantage of the new 7% rate if possible. Any suggestions on how to make the most of my savings?

Debt_Free_Chick

Well, it looks like you can't have another Halifax account. But what about someone you trust? e.g. could you get a parent/partner to open an account in their name, so you could give them money to save for you.

Remember, it will be their account so it would need to be someone you can trust and rely on.

crana9

why not open an abbey acct instead?

Robert_Sterling_3

could you get a parent/partner to open an account in their name, so you could give them money to save for you.

It sounds like fraud though it might well go undetected.
e.g.

A ( rich git or even your dad) says put this £3000 in an account in your name get the interest tax free.  Give me 80% of the interest keep 20% for your self and let me have my £3000 back any time I ask for it.  Hmmm.

I hope I am not giving anyone ideas here.

deemy2004

Give me 80% of the interest keep 20% for your self and let me have my £3000 back any time I ask for it.  Hmmm.

I hope I am not giving anyone ideas here.

Hey ! Could be makign of a website !

Transfer your tax free allowances to another person for 10% of the return on the money invested in your name

ssshhhhss you must not tell anyone  :o

System

With regards to savings my husband and I try to avoid putting anything in his name cos he pays 40% tax though we had thought of opening a regular saver in my 16 yr old daughters name.
The credit union accounts we have are funded by a straight withdrawal of £250 from my husbands salary and theres currently about £7500 between them, most in mine for tax reasons.
The nice thing is that the interest is paid gross and when I declared my interest last year to the Revenue although I had an underpayment I was told because it was less than £50 I wouldn't have to pay it. This basically meant I got my interest tax free. This year to try to get the same I think it would be best if there was no more than £5000 in my account (£5000 @ 5% = £250 interest *20% tax = £50)so where should I put the rest whilst I drip feed it into an Abbey 7% account along with the £250/mth which currently feeds the credit union.

Confused yet?? so am I. ???

Robert_Sterling_3

You can give your daughter money and she can then do what she likes with it.
You can not put your money in her name.

Your husband can put some money in his name in Mimi Cash Isas if he has not either already done so for 2004-2005 or if he has elected to go down the Maxi Isa Road.

You too could have £3000 in 2004-05 in a Tax Free Mini Cash Isa.

Putting all the savings in your name rather than your husbands is beneficial, legal and sound.

Milarky

...The nice thing is that the interest is paid gross and when I declared my interest last year  to the Revenue, although I had an underpayment, I was told because it was less than £50 I wouldn't have to pay it. This basically meant I got my interest tax free.  This year to try to get the same I think it would be best if there was no more than £5000 in my account (£5000 @ 5% = £250 interest *20% tax = £50)

If I read this correctly are you saying that hubby keeps £2500 in the CU as well, and so pays not tax on it (40£50 = 40% x £125) for the same reason as you, but can't put any more in? [ sneeky! ]

MarkyMarkD

You can give your daughter money and she can then do what she likes with it.
You can not put your money in her name.

You can't do what you say Robert.

Grandparents or uncles/aunts can give money to children with impunity, but if PARENTS do so, the interest is taxed as if it is earned by the parents if it exceeds £100 per parent. This rule applies until the child is 18.

http://www.inlandrevenue.gov.uk/leaflets/ir110.htm#16 refers.

Robert_Sterling_3

What I actually said was you can give your daughter money and then she can do what you likes with it.
I did not say that it would be taxed or it would not be taxed.
I was making the point that what you could not legally do was to put your money into an account in your daughter's name.

System

My hubby has to complete a tax return so he has to declare it and when you are self assessed it appears no matter how much you owe even if it is less than £50 it has to be paid or collected via the tax code. I don't understand why the difference between PAYE and SA.
We both have used our mini cash ISA's for this year so I'm looking for the best option until next April when we'll take another 2.

With regards to opening an account in our daughters name, how would anyone ie bank/ Inland Revenue know to tax it. If she fills in the form to be exempt from tax does that not cover it? I suppose if it comes down to it I could give the money to my dad to give to her. Is that illegal?