Do I pay tax on my £25,000 inheritance? TRICIA PHILLIPS Q A
YOU do not usually pay tax on the money you inherit at the time you receive it.
But you may need to pay income tax on any profit that you earn later from your inheritance, such as dividends from shares you buy, or rental income from a property.
The estate of the person who died usually pays inheritance tax if it is due.
ATHERE is usually an early redemption charge if you want to switch deals during a fixed mortgage term. The amount usually reduces as you near the end of the deal, and the amount you pay is based on a percentage of your outstanding balance.
So, the amount you are charged will depend on the size of your outstanding loan.
Check your key features document for your mortgage, which will give details of any early exit penalties.
Or call your lender to find out what your options are and how much it may cost to repay your balance earlier.
ALIKE with adult ISAs, a child can have a junior cash ISA and a junior stocks and shares ISA. You can currently save up to a maximum of £9,000 per child per tax year.
AFIXED-RATE bonds are usually offered by banks and building societies and you invest cash for a fixed term and will earn a fixed rate of interest, with up to £85,000 of your money protected with most banks under the Financial Services Compensation Scheme.
Retail bonds, on the other hand, are available from fund managers and they invest in companies. They are much riskier and that is why you get offered a better return.
Your cash is at risk and you could lose some or all of your investment, depending on how the company performs over the term of the bond.