Surrender endowment early - tax issues?

[Patio]

25 year endowment due to end next year but found out if surrender now will get £6.5k more than it was projected to be worth

Would the tax man be wanting to take a slice? Count towards income in relation to child benefit(pushing me well over the £60k threshold?

Thanks

[5pen]

Pretty sure it’s not counted as income, so nothing to worry about there, but most of these products have a final bonus added to them at maturity, so surrendering it early could be costing you money (despite the current value being higher than the target). If it only has a year to run, it would be prudent to check this out unless of course you desperately need the cash now.

[Simpo Two]

How old is the projection? Maybe it will be worth even more in a year's time. And when was a projection ever right?

If you sell an endowment to a company for £x it's because they think it will be worth £x+y at maturity.

[Armitage.Shanks]

I thought once bonuses were added each year they can't be taken away in which case I'd wait until it matures especially if there's an additional maturity bonus as mentioned above.

I had one from an old endowment mortgage and despite paying off the mortgage early kept the endowment running as a savings vehicle and the life cover it offered.

I think from memory if you've had it running for several (9+?) you can cash it in without paying tax?

[craig1912]

Tax free if it’s a qualifying policy which most are. If non qualifying it may be subject to CGT but definitely not income tax.