Chargeable Event Certificate

Hi David,

You may want to discuss with the Trusts team to confirm what should be declared and where 0300 123 1072.

Thank you.

Hi dorothyandjim,

To confirm it is still £10,000 as you look at the amount of your share of the event.

Thank you. 

 

Just to confirm, if a CEC is in the joint name of two people, the value of the CEC can be anything under £20,000 without the need for either person to register for self-assessment, because each person's individual share will be less than £10,000. Is this correct?

Hi dorothyandjim

Yes, that is correct, please see - Check if you need to send a Self Assessment tax return

Thank you.

I have just cashed in my Bond at a value of £37,000 and have been advised of a chargeable event of £13,300. My total earnings for this financial year will be £20,000. How much tax will I be liable for on this chargeable event?

I invested £23k in 2012 and I have made no withdrawals or alterations to the bond. Am I correct in assuming £10k of the chargeable event value will not be subject to tax and the £3,300 will be at basic rate of tax?

Hi,

Notional tax should have already been deducted on this. If not, you will be liable to tax at 20% on the £13000.

Thank you.

Can I just check, if notional tax has not been deducted, will I be entitled to £5k annual allowance on this tax year?

Hi PaddyO biriani,
Further guidance also available at:
How to calculate a gain
Thank you.

Hi PaddyO biriani,
This is not taxed as a capital gain so there is no annual allowance against this.
It is taxed as normal income and added to your other sources to ascertain any additional tax due.
Thank you. 
 

Hi HMRC If I receive a chargeable event for an onshore bond with notional tax deducted and keeps me in the basic rate band, does this need reporting? Also, what if any gain fell within my personal savings band?

Hi alex Thomas,
Yes, you still need to inform HMRC.
If it is over £10,000 it needs to be reported on a tax return.
Thank you. 

To help me decide about cashing in a life assurance bond that has had notional basic rate tax deducted, can someone please confirm my understanding of the rules in Scotland. In Scotland the Higher Rate for Income Tax on Earned or Pension Income applies to income above £43,662, compared to £50,271 for the rest of the UK, but for Savings Income the figure of £50,271 applies to all of the UK , including Scotland. So if, for example, I had Pension Income of £25,000 and a Chargeable Event certificate of £25,000 from cashing a bond, I would not be liable to any Higher Rate tax in Scotland. Am I correct?

Hi dorothyandjim,
That is correct as you would still have your personal allowance to take your income below the higher rate figure. 
Please see guidance here:
Income Tax in Scotland
Thank you. 

Hi, I am after some advice. I have recently received a chargeable event certificate regarding a gain on a matured saving scheme with LV. The gain was only £4000. Do I have to fill in a tax return on this? It is all rather confusing.

Hi Cassandra Perrett
You would only need to complete a return if the total amount of gain and any other investment income for the year is £10,000 or more.