How it works
Enter your total savings interest for the year and your income-tax band (basic, higher or additional). We apply the Personal Savings Allowance and your marginal rate in your browser.
In detail
Most people pay no tax on savings interest thanks to the Personal Savings Allowance (PSA) and the starting rate for savings. The PSA lets you earn a set amount of interest tax-free each year, and anything above it is taxed at your marginal rate.
2026/27 Personal Savings Allowance
| Band | Tax-free allowance | Rate above it |
|---|---|---|
| Basic-rate | £1,000 | 20% |
| Higher-rate | £500 | 40% |
| Additional-rate | £0 | 45% |
Worked examples
Basic-rate taxpayer, £1,500 interest: £1,500 − £1,000 PSA = £500 × 20% = £100.
Higher-rate taxpayer, £2,000 interest: £2,000 − £500 PSA = £1,500 × 40% = £600.
Additional-rate taxpayer, £3,000 interest: £3,000 − £0 PSA = £3,000 × 45% = £1,350.
Related calculators
Savings interest sits alongside dividend and salary income when setting your band — see our Income Tax and Dividend tax tools. Keeping cash in an ISA keeps the interest completely tax-free.
There is also a starting rate for savings of up to £5,000 taxed at 0%, available if your other taxable income is below £17,570. This calculator applies the PSA by band; it does not model the starting-rate interaction. Interest from ISAs remains completely tax-free. The authoritative source is GOV.UK — Tax on savings interest.
Worked example · 计算示例
Worked example: £1,500 savings interest (basic-rate)
You earn £1,500 in taxable savings interest and are a basic-rate taxpayer:
- Personal Savings Allowance: first £1,000 is tax-free.
- Taxable interest: £1,500 − £1,000 = £500.
- Basic-rate tax 20%: £500 × 20% = £100.
Higher-rate taxpayers get a £500 allowance; additional-rate taxpayers get £0. The 0% starting rate for savings can also apply below £17,570 of other income.
计算示例：£1,500 储蓄利息（基础税率）
你获得 £1,500 应税储蓄利息，为基础税率纳税人：
- 个人储蓄免税额：首 £1,000 免税。
- 应税利息：£1,500 − £1,000 = £500。
- 基础税率 20%：£500 × 20% = £100。
高税率纳税人免税额为 £500；附加税率纳税人为零。其他收入低于 £17,570 时还可适用 0% 储蓄起征率。
FAQ
How much savings interest is tax-free in 2026/27?
Basic-rate taxpayers get a £1,000 Personal Savings Allowance, higher-rate £500, and additional-rate taxpayers get none.
What rate is savings interest taxed at?
Any interest above your allowance is taxed at your marginal income-tax rate: 20%, 40% or 45%.
Are ISA savings taxed?
No. Interest earned inside an ISA is tax-free and does not use your Personal Savings Allowance.
What is the starting rate for savings?
Up to £5,000 of savings can be taxed at 0% if your other taxable income is below £17,570. This calculator focuses on the PSA.
Do I need to declare savings interest?
Usually not if you are a basic-rate taxpayer within the PSA and tax is collected via PAYE (banks report interest to HMRC). Higher and additional-rate taxpayers, or those with large interest, may need a Self Assessment return.
How does the starting rate interact with the PSA?
If your other taxable income is below £17,570, up to £5,000 of savings can be taxed at 0% on top of the PSA. It reduces by £1 for every £1 of other income above the personal allowance.
Does the PSA cover joint or child accounts?
The PSA is personal. A child's account interest is generally taxed on the parent above £100 a year (unless in a junior ISA), and joint accounts split the interest between holders.