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taxadvisor.uk
taxadvisor.uk, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 7310
Experience:  FCCA - over 40 years experience as a qualified accountant (UK based Practitioner)
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I received £8095.21 from closing my life insurance policy.

This answer was rated:

I received £8095.21 from closing my life insurance policy. They tell me that I may have to pay tax but because my wife is disabled we are on income support and otherwise tax free. However, whoever I talk to or wherever I go to online, I am treated as being a worker, landlord or someone with corona virus problems. Where should I be going and what do I need to fill in?
JA: Are there other sources of income besides the disability payments?
Customer: I receive carers allowance and a private pension of £194.87 fixed every calendar month
JA: Anything else you want the Accountant to know before I connect you?
Customer: no

Hello and welcome to JustAnswer. I am here to help you.

Please advise if you

- have received a chargeable event certificate from the life insurance company

- file a tax return

- are you a basic rate tax payer
Many thanks

Customer: replied 7 days ago.
I have received a chargeable account certificate asking me to check with my tax office.
However I have not filed a tax return for about ten years
And I am otherwise not on any tax rate due to being on benefits.

Thank you for your reply.

You may have to pay income tax on the gain shown on the chargeable event certificate if you are a higher rate taxpayer as tax at basic rate is deemed as deducted at source.

If you have not filed a tax return for about ten year, I suggest you write to HMRC at

Self Assessment

HM Revenue and Customs

BX9 1AS

and advise you have a chargeable event certificate showing a gain. As a basic rate taxpayer there is no further tax payable by me.

More information on how to report chargable gain event on tax return here

https://www.gov.uk/government/publications/gains-on-uk-life-insurance-policies-hs320-self-assessment-helpsheet/hs320-gains-on-uk-life-insurance-policies-2020

My aim is to give you a professional service. I hope this is helpful and answers your question.

If you need more assistance, please use the reply box below and let me know. It has been my pleasure to assist you with your question.

taxadvisor.uk and other Tax Specialists are ready to help you

I thank you for accepting my answer.

I'm glad I could help you resolve this today. Please follow up here if you have any other questions.

Best wishes.

Customer: replied 7 days ago.
Thank you very much it may be just what I need

Thank you for your kind words.

Best wishes.