Is my bank interest income taxable?

As a higher-rate taxpayer, you are entitled to a personal savings allowance of £500. This means that £500 of your interest income is tax-free. The remainder of your interest income will be taxed at your usual tax rate. As a higher rate taxpayer this is 40% in England, Scotland, Wales and Northern Ireland. 

If you prepare a self-assessment income tax return you will need to ensure you report all your savings income, the tax payable on your savings income will then be included in your tax liability. 

If you have any accountant who prepares your tax return, provide them with details and evidence of the interest you received. You may have received an annual interest declaration from your savings provider which covers the tax year, which is perfect. 

For more information, and to speak to our friendly accountants call 01242 807200 or use our online contact form. 

Date published 15 Nov 2023 | Last updated 15 Jan 2024

This article is intended to inform rather than advise and is based on legislation and practice at the time. Taxpayer’s circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this article, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.

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