Jobs & Education2 mins ago
Cash Isa And Benefits
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Hi
Not sure where I should post this so trying here. Elderly friend (married) gets help with community charge payments (are these tax credits? not sure), he receives state pension and occupational pension, has a small amount of savings in the bank and that's it as far as I know. I said I thought he would benefit in getting a Cash Isa too so he can gain some tax free interest but he reckons that he will have his benefits cut because of the Isa. I thought not because he's not really going to have loads of money to put in it but I don't want to misinform him when I could be wrong. So would a cash Isa reduce his benefit help at all can anyone tell me please? Many thanks.
Not sure where I should post this so trying here. Elderly friend (married) gets help with community charge payments (are these tax credits? not sure), he receives state pension and occupational pension, has a small amount of savings in the bank and that's it as far as I know. I said I thought he would benefit in getting a Cash Isa too so he can gain some tax free interest but he reckons that he will have his benefits cut because of the Isa. I thought not because he's not really going to have loads of money to put in it but I don't want to misinform him when I could be wrong. So would a cash Isa reduce his benefit help at all can anyone tell me please? Many thanks.
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No best answer has yet been selected by daisya. Once a best answer has been selected, it will be shown here.
For more on marking an answer as the "Best Answer", please visit our FAQ.Thanks for your answers, yes his savings are taxed but apparently not much interest taken so I know what you're saying boxy. It's just that I thought if he (or anyone) doesn't have to pay tax then why do it. His pension is taxed too so I thought why pay tax on savings as well if he doesn't have to. Perhaps I shall leave well alone (me and my advice lol).
If he pays tax and he can find an ISA paying a decent rate (almost impossible imho) , he will be better off and as others have said, it makes not a jot of difference to his benefits ....he will either be above or below the threshold wherever he saves it.
If he does not pay tax, he should ask his bank/building society for the appropriate form to send to HMRC to have his bank /building society pay his interest without tax.
If he does not pay tax, he should ask his bank/building society for the appropriate form to send to HMRC to have his bank /building society pay his interest without tax.
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