Hi
I am completing a tax return for my mother and would appreciate some advice regarding taxation with respect to bonds.
My mothers (65yrs) basic income from state/private pensions & interest on savings is around 24k gross (basis rate tax payer with tax deducted by her main pension provider and at source on savings). She also had a 50k with-profits bond, which she took-out 31/03/99, from which she received a small income (less than 5%) of the bond.
During tax year 04/05, with the bond performing relatively poorly, she made a partial withdraw of 25k from the bond (at that time no mva was applicable on a partial withdrawal up to 25k).
Following the 25k withdrawal, my mother received a 'Chargeable Events Certificate - Partial Surrender' from the bond provider. I am using this information to fill-in the tax return form. The main info the certificate provides is (a) Last relevant date - 30/03/2003, (b) Number of complete years since last relevant date - 2yrs (c) Amount of gain arising on this event 23,555 & (d) Notional tax 4,712.
I am intending to add this to the tax return form boxes 12.3 [2], 12.4 [4,712] & 12.5 [23,555].
Please could someone confirm that my mother will not incur any further tax liability, due to this partial cash-in of the bond?
Many thanks