How are term bonds taxed?
A term bond is a bond that pays interest at a specified time, maybe five years from the date it was taken out. For example, National Savings & Investments has Pensioner Bonds that can last for 1, 2 or 5 years. Interest is taxable in the year it is paid. So, for example, if a bond matures on its fifth anniversary and all of the interest which has accrued since it was taken out is paid on that date, the total amount of interest is taxable in that one tax year. This could mean that you could be a non-taxpayer during the term of the bond, and therefore be eligible to register other bank or building society accounts (using form R85) to receive interest without tax taken off and / or to make Gift Aid donations. However, the amount of interest paid when the bond matures, together with any other income you receive, may be such that you are liable to pay tax for that particular year. If this is the case you must tell HM Revenue & Customs. If you do not know how to contact HM Revenue & Customs y
A term bond is a bond that pays interest at a specified time, which may be five years from the date it was taken out. For example, National Savings & Investments has Pensioner Bonds that can last for 1, 2 or 5 years Interest is taxable in the year it is paid. So, for example, if a bond matures on its fifth anniversary and all of the interest which has accrued since it was taken out is paid on that date, the total amount of interest is all taxable in that one tax year. For examples of how term bonds are taxed. This could mean that you could be a non-taxpayer during the term of the bond, and therefore be eligible to register other bank or building society accounts (using form R85) to receive without tax taken off and/or to make Gift Aid donations. However, the amount of interest paid when the bond matures, together with any other income you receive, may be such that you are liable to pay tax for that year. If this is the case you must tell your tax office. If you do not know how to conta
