Quizzes & Puzzles0 min 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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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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