Personal Savings Allowance - All you need to know

New rules to be introduced on 6 April 2016
Personal savings allowance

From 6 April 2016, if you’re a basic rate taxpayer you’ll be able to earn up to £1,000 in savings interest income tax-free. Higher rate taxpayers will be able to earn up to £500. This is called the Personal Savings Allowance.

At the moment 20% tax is deducted from all savings accounts other than ISAs but that will change when the new rules come into effect at the start of the next financial year on 6 April 2016.

The government estimates that 95 % of savers will benefit from the new allowance and won't pay tax on the savings interst they accrue.

You don't have to do anything to claim your new personal savings allowance so look forward to seeing more cash in your accounts.

Find out more about the personal savings allowance on the following websites.