Latest news with #non-ISA
Daily Mirror
4 days ago
- Business
- Daily Mirror
Nearly 1.2 million savers warned they could face unexpected tax bill
If you are basic-rate (20%) taxpayer then you can earn up to £1,000 in savings interest each tax year before you start to pay tax on interest you've earned Nearly 1.2 million savers risk being hit with a tax bill when their accounts mature this year. If you are basic-rate (20%) taxpayer then you can earn up to £1,000 in savings interest each tax year before you start to pay tax on interest you've earned. This is known as the Personal Savings Allowance. For higher-rate (40%) taxpayers, the Personal Savings Allowance is £500 every tax year. Additional rate taxpayers (45%) don't get any Personal Savings Allowance. If you earn below the personal allowance of £12,570, there is a £5,000 starting rate for savings. When you start to earn above this amount, you lose £1 of your £5,000 starting rate for savings for each £1 you earn above the personal allowance. This means once you start to earn above £17,570, your £5,000 starting rate for savings is effectively wiped out. More people have been pushed over their Personal Savings Allowance due to huge improvements in savings rates over the past few years. If you are worried about breaching your allowance, you can put up to £20,000 a year into an ISA savings account and any interest earned is tax-free. You will also want to make sure that any account you choose gives you the best interest rate for your money. Paragon Bank has analysed the number of savings accounts that will reach the end of their one year fixed-term between June and the end of the year. It estimates there are 1.17 million one-year fixed-term adult non-ISA accounts maturing during the period that will generate interest of more than £500, which would breach the Personal Savings Allowance for higher-rate taxpayers. Of those accounts, 822,000 will accrue more than £1,000 in interest, which is the Personal Savings Allowance for basic-rate (20%) taxpayers. In total, 1.7 million one year fixed-term adult non-ISA savings accounts are due to mature between June and the end of December, with a value of £70.5billion. Paragon Bank Head of Savings, Andrew Wright, said: 'Fixed-rate savings dominated the market during 2023 and 2024, with many accounts benefitting from high savings rates. 'Many savers will have had a great return on their savings but could ultimately breach their personal tax allowance as a result.' He added: 'Many of those one-year accounts are now maturing over the next six months and nearly 1.2 million people could potentially receive a tax bill. 'Therefore, I urge savers review their accounts and make the most of their tax-free allowance by utilising other savings products, including cash ISAs.'
South Wales Argus
12-06-2025
- Business
- South Wales Argus
Winter Fuel Payment scams rise and how to avoid them
The payment was only available to pensioners receiving Pension Credit or other means-tested benefits. It will now be made to anyone with an income of under £35,000 a year, but many pensioners are unsure on whether they qualify. "There's a lot of confusion about who qualifies and who doesn't," says Fiona Peake, Personal Finance Expert at Ocean Finance. "Simply put, if you're over state pension age and your total annual income is £35,000 or less, you'll receive the payment. This includes income from private pensions, freelance work, and interest on non-ISA savings." The full details were announced here. Millions of pensioner households faced unaffordable energy costs last winter. While the changes will provide some relief to these households, there will still be pensioners unable to afford the high cost of energy and living in cold damp homes. So now the Government must focus… — End Fuel Poverty Coalition (@EndFuelPoverty) June 9, 2025 "It'll land in your bank account automatically, likely in November or December," says Fiona. "No forms, no calls, no claims. For those who know they'll be over the income limit, there'll be a way to opt out of the payment completely, to avoid having to repay it later but the government hasn't said exactly how yet. "The Winter Fuel Payment will be a lifeline for nearly two million older households who are living in fuel poverty, but the new eligibility criteria make things more complicated. A single pensioner earning £36,000 a year could have to pay back the full amount, while a couple earning £69,000 could keep every penny. That creates grey area scammers love to exploit." Devolved authorities in Scotland and Northern Ireland will each receive a funding uplift so they too can meet the new threshold. Independent Age chief executive Joanna Elson said: 'We are pleased that the UK Government has listened to the voices of older people on a low income and reconsidered what was an incredibly damaging change to the winter fuel payment. 'By widening the eligibility criteria, more older people in financial hardship will now receive this vital lifeline in time for winter. 'Our helpline receives thousands of calls from older people making drastic cutbacks just to get by and the changes to the winter fuel payment made this worse. For millions living on low incomes, the entitlement supports them to turn their heating on and stock up on food during the colder months. 'While the changes to the winter fuel payment are positive, they are not a silver bullet that will end pensioner poverty.' Recommended reading: What to do if you think you have been the victim of a scam First up, don't panic, and don't blame yourself - it's easily done. The sooner you report it, the better. Siobhan Blagbrough, Financial Crime Manager at Ocean Finance, says: 'Fraudsters often pounce on government announcements to trick people when the public is most likely to be unsure of the rules. We're already seeing fake messages pretending to be from the Department for Work and Pensions (DWP), urging pensioners to 'apply now' or risk missing out on their £300 payment. "These scam texts often include fake links and ask for personal details or for people to reply 'YES' to claim the payment. These messages are bogus. The DWP has confirmed that eligible households will receive the money automatically, and no application is needed. 'If you've already clicked a link or given details, contact your bank immediately. You can also report it to Action Fraud on 0300 123 2040. Above all, trust your instincts. Genuine government payments won't be sent via text messages with links or requests for personal information.'
Glasgow Times
11-06-2025
- Business
- Glasgow Times
Winter Fuel Payment scams rise and how to avoid them
The payment was only available to pensioners receiving Pension Credit or other means-tested benefits. It will now be made to anyone with an income of under £35,000 a year, but many pensioners are unsure on whether they qualify. "There's a lot of confusion about who qualifies and who doesn't," says Fiona Peake, Personal Finance Expert at Ocean Finance. "Simply put, if you're over state pension age and your total annual income is £35,000 or less, you'll receive the payment. This includes income from private pensions, freelance work, and interest on non-ISA savings." The full details were announced here. Millions of pensioner households faced unaffordable energy costs last winter. While the changes will provide some relief to these households, there will still be pensioners unable to afford the high cost of energy and living in cold damp homes. So now the Government must focus… — End Fuel Poverty Coalition (@EndFuelPoverty) June 9, 2025 "It'll land in your bank account automatically, likely in November or December," says Fiona. "No forms, no calls, no claims. For those who know they'll be over the income limit, there'll be a way to opt out of the payment completely, to avoid having to repay it later but the government hasn't said exactly how yet. "The Winter Fuel Payment will be a lifeline for nearly two million older households who are living in fuel poverty, but the new eligibility criteria make things more complicated. A single pensioner earning £36,000 a year could have to pay back the full amount, while a couple earning £69,000 could keep every penny. That creates grey area scammers love to exploit." Devolved authorities in Scotland and Northern Ireland will each receive a funding uplift so they too can meet the new threshold. Independent Age chief executive Joanna Elson said: 'We are pleased that the UK Government has listened to the voices of older people on a low income and reconsidered what was an incredibly damaging change to the winter fuel payment. 'By widening the eligibility criteria, more older people in financial hardship will now receive this vital lifeline in time for winter. 'Our helpline receives thousands of calls from older people making drastic cutbacks just to get by and the changes to the winter fuel payment made this worse. For millions living on low incomes, the entitlement supports them to turn their heating on and stock up on food during the colder months. 'While the changes to the winter fuel payment are positive, they are not a silver bullet that will end pensioner poverty.' Recommended reading: What to do if you think you have been the victim of a scam First up, don't panic, and don't blame yourself - it's easily done. The sooner you report it, the better. Siobhan Blagbrough, Financial Crime Manager at Ocean Finance, says: 'Fraudsters often pounce on government announcements to trick people when the public is most likely to be unsure of the rules. We're already seeing fake messages pretending to be from the Department for Work and Pensions (DWP), urging pensioners to 'apply now' or risk missing out on their £300 payment. "These scam texts often include fake links and ask for personal details or for people to reply 'YES' to claim the payment. These messages are bogus. The DWP has confirmed that eligible households will receive the money automatically, and no application is needed. 'If you've already clicked a link or given details, contact your bank immediately. You can also report it to Action Fraud on 0300 123 2040. Above all, trust your instincts. Genuine government payments won't be sent via text messages with links or requests for personal information.'
South Wales Guardian
11-06-2025
- Business
- South Wales Guardian
Winter Fuel Payment scams rise and how to avoid them
The payment was only available to pensioners receiving Pension Credit or other means-tested benefits. It will now be made to anyone with an income of under £35,000 a year, but many pensioners are unsure on whether they qualify. "There's a lot of confusion about who qualifies and who doesn't," says Fiona Peake, Personal Finance Expert at Ocean Finance. "Simply put, if you're over state pension age and your total annual income is £35,000 or less, you'll receive the payment. This includes income from private pensions, freelance work, and interest on non-ISA savings." The full details were announced here. Millions of pensioner households faced unaffordable energy costs last winter. While the changes will provide some relief to these households, there will still be pensioners unable to afford the high cost of energy and living in cold damp homes. So now the Government must focus… "It'll land in your bank account automatically, likely in November or December," says Fiona. "No forms, no calls, no claims. For those who know they'll be over the income limit, there'll be a way to opt out of the payment completely, to avoid having to repay it later but the government hasn't said exactly how yet. "The Winter Fuel Payment will be a lifeline for nearly two million older households who are living in fuel poverty, but the new eligibility criteria make things more complicated. A single pensioner earning £36,000 a year could have to pay back the full amount, while a couple earning £69,000 could keep every penny. That creates grey area scammers love to exploit." Devolved authorities in Scotland and Northern Ireland will each receive a funding uplift so they too can meet the new threshold. Independent Age chief executive Joanna Elson said: 'We are pleased that the UK Government has listened to the voices of older people on a low income and reconsidered what was an incredibly damaging change to the winter fuel payment. 'By widening the eligibility criteria, more older people in financial hardship will now receive this vital lifeline in time for winter. 'Our helpline receives thousands of calls from older people making drastic cutbacks just to get by and the changes to the winter fuel payment made this worse. For millions living on low incomes, the entitlement supports them to turn their heating on and stock up on food during the colder months. 'While the changes to the winter fuel payment are positive, they are not a silver bullet that will end pensioner poverty.' Martin Lewis shares 'crucial need to know' energy bill rules First up, don't panic, and don't blame yourself - it's easily done. The sooner you report it, the better. Siobhan Blagbrough, Financial Crime Manager at Ocean Finance, says: 'Fraudsters often pounce on government announcements to trick people when the public is most likely to be unsure of the rules. We're already seeing fake messages pretending to be from the Department for Work and Pensions (DWP), urging pensioners to 'apply now' or risk missing out on their £300 payment. "These scam texts often include fake links and ask for personal details or for people to reply 'YES' to claim the payment. These messages are bogus. The DWP has confirmed that eligible households will receive the money automatically, and no application is needed. 'If you've already clicked a link or given details, contact your bank immediately. You can also report it to Action Fraud on 0300 123 2040. Above all, trust your instincts. Genuine government payments won't be sent via text messages with links or requests for personal information.'
Business Mayor
23-05-2025
- Business
- Business Mayor
HMRC to send out 6 million unexpected bills to ‘rule break' UK households
Millions of households across the UK could be set for a HMRC letter after they accidentally breached a 2016 rule. In January, more than six million accounts exceeded the Personal Savings Allowance (PSA) threshold, designed to let savers earn a limited amount of interest tax-free. As a result, millions of people could be set for an unexpected tax bill in the coming months. Sally Conway, savings expert at Shawbrook, said: 'Without careful consideration, savers could face a shock tax bill on their nest eggs. With savers still taking advantage of competitive interest rates, many savers could be sleepwalking into a tax bill on their interest.' She added: 'This is particularly relevant for higher-rate taxpayers, who only get £500 tax-free, and additional-rate taxpayers, who get none. 'For example, a higher-rate taxpayer with £12,000 in a non-ISA account earning 4.30% could exceed their tax-free allowance. 'There are currently over five million more savings accounts at risk of tax than there were just over three years ago. This outlines just how much the frozen threshold has impacted savers who aren't making use of ISAs. 'It can be a great way to boost savings in a tax-efficient manner. Additionally, exploring options beyond major banks might lead to better interest rates, often specialist savings banks can be savers' best-kept secret.' The personal savings allowance allows taxpayers to earn £1,000 of interest tax free each year, but this is slashed to £500 for higher rate taxpayers and is zero for those paying 45p tax. Frozen income tax thresholds are causing more and more people to pay the higher rate of tax, meaning that they are unwittingly reducing their personal savings allowance by 50%. As a result, those earning more than £50,270 will lose 40 per cent to tax on any interest of more than £500 per year. The tax-free allowance relates to interest earned in bank and building societies, savings and credit union accounts, peer-to-peer lending, trust funds and some life insurance contracts. For people unsure about whether they are likely to owe tax to HMRC or wondering how much they will be obligated to pay, the government's website allows you to check using their tax calculating tool. READ SOURCE
