£100,000 to save where?????

jem16

pspsi_cola wrote: »

hi again,

well i finally completed on my house and picking up the cheque on tuesday.

REALLY need some further advice please, though i am seeing another IFA next week?

Went to see an IFA today and he said that i couldn't put the money in a tax free savings account other than in an ISA which i already have. His rational was that the government was mean and make having other tax free savings imposssible!!!??????? I'm confused as i thought you could and the above link says you can!

Did you see an actual IFA or a tied FA from a bank?

An ISA is one tax-free savings account. The other, as you have been told, is
NS&I Savings certificates.

What do you think to what he said?? Is it impossible? Any other ideas and which tax free company is good, if that makes any sense?

You have to weigh up the interest being offered. An account offering tax-free interest is not any good if the interest rate is very poor. Compare what you can get net of tax with a top paying taxed account with what you can get tax-free.

There is no other tax-free options worth considering - there are friendly societies offering tax-free investments but they are rubbish. Far better in a taxed account.

pspsi_cola

Yes, it was an IFA not the ones that are attached to a bank.

I guess i must have misread something along the way and got confused. will have a look and compare.

I just need an idiots proof guide to savings!! I get all stressed out with understanding what AER, gross and net stand for and how they apply to me.

Can anyone explain in lay terms?
Anyone know the best savings accounts around, though i will look for myself too.

Gosh - having no money is stressful but having too much is also stressful!!!

jem16

pspsi_cola wrote: »

Anyone know the best savings accounts around, though i will look for myself too.

http://www.moneysavingexpert.com/savings/savings-accounts-best-interest

jamesd

pspi cola, there are many ways to save the money so that it is not counted in tax credit calculations. The tax free NS&I schemes including Premium Bonds are one way. Making pension contributions also reduces the income for WTC calculations - a single person can be making 100k, contribute 94k to a pension and get 2535 in Working Tax Credits. For more details see pages 20 on in HMRC leaflet WTC2.

Jonbvn

fizzbang wrote: »

Are you sure? - Tax credits are means tested so that means it should take all capital; savings, stocks and shares, property (except first home) into account regardless of whether it is in tax-free (ISA) savings or not. The only thing means-tested benefits do not take into account is your pension fund.

The reason I say is that someone who has just won the lottery can technically still claim if they earn say £10k in employment... surely that can't be right?

From the HRMC website all capital and income from ISA's, NS&I tax-free savings & pensions is excluded.

pspsi_cola

Jonbvn wrote: »

From the HRMC website all capital and income from ISA's, NS&I tax-free savings & pensions is excluded.

Ok let me get this straight in my head, since its really starting to hurt now!!

If i put the money into either ISA's or NS&I tax free savings i can still claim some WTC and CTC - correct?? Where as, in a high interest taxed BS account i will not be able to claim these benefits.

Whilst the interest is not that great on the tax free options, at least that is counter balanced as i can claim WTC and CTC.

muddyfox470

6 month bond/fixed savings paying 6.x % ? Think you can still get 6.9% (before tax)

Jonbvn

pspsi_cola wrote: »

Ok let me get this straight in my head, since its really starting to hurt now!!

If i put the money into either ISA's or NS&I tax free savings i can still claim some WTC and CTC - correct?? Where as, in a high interest taxed BS account i will not be able to claim these benefits.

Whilst the interest is not that great on the tax free options, at least that is counter balanced as i can claim WTC and CTC.

From the WTC2 guide:

We take the following types of income into account when we work out how much tax credits to pay:
Most income from savings and investments (for instance, interest from bank and building society accounts, dividends from UK companies, payments from trusts or the estate of a deceased person in administration) - but not income from certain tax-exempt investments, such as, Individual Savings Accounts (ISAs), Personal Equity Plans (PEPs) or non-taxable National Savings products.

From the WTC2 guide:

....contributions to any HM Revenue & Customs registered pension scheme (such as an occupational pension scheme, a personal pension plan or retirement annuity) and payments under the Gift Aid or Payroll Giving schemes should be deducted when you work out your income for a tax credit claim.

More details on the WTC guide from HMRC. http://www.hmrc.gov.uk/leaflets/wtc2.pdf

Penelope_Penguin

fizzbang wrote: »

Pretty sure you can not claim WTC or CTC with that amount of savings. (I think anything above £16,000 in savings stops you).

As has been said, there's no limit on savings for Tax credits. HMRC will calculate how much they reckon you'll get in interest from those savings and use that as income to assess if you're eligible.

pspsi_cola

feel very weiry posting again on this same matter but am in need of some further advice.

Saw another IFA today and he has just confused me. He suggested to put the money in the IAG Managed Portfolio Bond - which is off shore. Yet the other IFA i saw last week said to best avoid off shore but never gave a reason. So 2 IFA saying different thing
I have nothing to hide and will declare this money anyway but is off shore any good and does anyone know anything good/bad about the above product?