Making the most of short-term cash windfall

August 6, 2011 8:39 AM

Due to company error, I have been saddled with a four-figure tax liability, due at the end of the year to HMRC. I received a no-interest loan from my company to cover this liability -- what can I do with it between now and the end of the year to maximize the value of this excess cash?

The amount is roughly £4,000. I'm an American citizen living in the UK with UK current and savings accounts. Any short term investments that are appropriate? Just stash it in my savings account? Move it to the US and invest?

Just for further information, any taxes that may be incurred by this loan are being covered by my company. The loan has been denominated in US$ and is payable in US$ to avoid currency issues. It is payable after I receive my 2011 US tax refund circa Q2 2012.

How can I make the most of this situation?

posted by anonymous to Work & Money (1 answer total)

Do you have other liquid assets to cover the loss of the loaned money should you invest it and the investment decrease in value? If not, avoid investments with high risk (including stocks).
posted by zippy at 10:46 AM on August 6, 2011