do students pay tax on savings?

ashjamben

i have some money in a savings account with rbs, but i've been thinking of changing to a different savings account/isa as the interest doesn't seem too good.

i've been wondering, when the rate is explained for various banks it states the gross and net. but i'm a student, so don't pay tax for most things. does this apply to savings aswell? would i get the full gross rate?

thanks for reading

opinions4u

If your income (this excludes loans / grants / parental support, but includes interest) is less than £6,035, you can sign an R85 form (verbal declaration accepted by most banks) with your bank to have interest paid gross. This applies to current accounts too.

ISAs can still be good for non-taxpayers, especially if your savings will remain in tact after you finish studying, because this means you will have more tax free interest income when you start earning.

If you think it's likely your savings will be spent during the year, and you are a non-taxpayer, chase the best rate and don't worry about ISA.

agsnu

And just to re-iterate this point: Whether you pay income tax or not depends entirely on your income, whether you are a student or not has nothing to do with it.