Last week’s Budget/Financial Statement will mean that many with shares who currently don’t, will have to start completing a tax return. World Economic Conditions/The Previous PM and Chancellor/Delete As Applicable, and the resulting rise in interest rates will take still more into the clutches of the HMRC’s annual torture, a rather less-trailed cause and effect. If you have more than around £50,000 in the average instant access account, or £25,000 on a decent fixed-rate, you’ll be earning more than the £1,000 interest rate allowance (£500 for high rate taxpayers). Which means you’ll have to declare it and fill in a tax return. This will, again, sneak up on a lot of people, and cause more than a little stress, I’d wager, for the conscientious. Cash ISAs, which, with next-to-nothing interest rates have not been worth the bother, now are; but remember, despite appearances, stocks and shares always do and will again rise to the occasion, and still be the long-term inflation beaters. Keep the faith.
“The true impact of inflation on cash savings and pensions”
Leaving your money in the bank or building society has always meant that its ‘real value’ after inflation will go down. Although rates go up to, supposedly, control inflation, any chart you look at will show that, apart from a few very short-term blips (N Lamont, I’m looking at you) they are never more than inflation.