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Where Taxpayers and Advisers Meet

A chargeable event...

eros
Posts:1
Joined:Wed Aug 06, 2008 4:10 pm

Postby eros » Mon Jul 07, 2008 10:32 am

I recently cashed in a savings policy that would mature after 10 years, I cashed it in after six, the company deposited the balance in my account, however they have sent me a chargable events certificate. Will I have to pay extra tax on this?

bob.fraser@towrylaw.
Posts:765
Joined:Wed Aug 06, 2008 3:14 pm

Postby bob.fraser@towrylaw. » Mon Jul 07, 2008 12:14 pm

The answer depends on a number of factors.
a. Did the policy make a profit> ie did you get back more than you paid in? If so, how much more?
b. What is your taxable income for the tax year in which you encashed the policy.
c. Is the policy with a UK company, or is the company based in the Isle of Man, the Channel Islands, or Dublin?

Bob Fraser
Chartered Financial Planner

pawncob
Posts:4656
Joined:Wed Aug 06, 2008 4:06 pm
Location:West Sussex

Postby pawncob » Mon Jul 07, 2008 1:49 pm

Depending upon your answers to Bob, if you're a higher rate tax payer, there may be tax due, subject to top slicing relief.
Basic rate tax is normally covered by the tax credit.
With a pinch of salt take what I say, but don't exceed your RDA


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