Property News · April 30, 2016

Britain is a savers’ paradise … but only for the few


We get access to more tax breaks than almost any other developed country, but not everyone has the money to benefitWell-off Brits are living in a savings paradise. There is almost no need to head off to Panama or the Caymans when Britain itself is such a tax haven. You may not think this, given the miserably low interest rates on savings accounts, but Brits – or, to be more accurate, Britain’s upper-middle classes, because few others have the money – get access to more tax breaks than virtually anyone else in the developed world.Take the new personal savings allowance (PSA). The first £500 of savings interest is now tax-free if you are a 40% taxpayer. This roughly equates to zero tax on the first £35,000 or so of savings balances. It’s worth more to a lower-rate taxpayer, who can shield £70,000 in savings from tax, but show me someone on average earnings who has that much in savings and I’ll show you a junior doctor who supports Jeremy Hunt. The truth is that the main beneficiaries of the new PSA will be the already well-off. Continue reading…

Source : theguardian.com
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