taxed on Basic bank accounts savings

sporty1

Hi can anyone tell me if someone over 18 has Basic bank account Nat west, is there a limit to what they can save without being taxed on it
thanks

Lokolo

Depends how much they earn each tax year.

LittleVoice

sporty1 wrote: »

Hi can anyone tell me if someone over 18 has Basic bank account Nat west, is there a limit to what they can save without being taxed on it
thanks

I don't think that someone has a Basic bank account with NatWest has any bearing on how much is saved/taxed. All your savings are lumped together to work out tax liability.

How much you can save without being taxed depends on the rate of interest and what other income (earned or unearned) that you have.

In the UK it is not your savings which are taxed but the interest paid thereon. So, for example, other things being equal, if you are receiving 1% gross interest you can save five times as much before you would be taxed than if you were getting 5% gross interest.

Reaper

Here is a table saying how much you can earn before paying tax.
http://www.hmrc.gov.uk/rates/it.htm

LucyTheDwarf

You have a personal allowance of £6035 for the 08/09 tax year. If you earn more than this - in wages, interest etc, you will pay tax at 20% on all earnings above this level.

ed123_2

....but if you have only savings income you pay tax at 10% on the next £2230 above the £6035 personal allowance...

colin79666

You pay tax a 20% on savings (the interest) as default. If you are earning under the personal allowance you can get a form from the bank which you fill in and send to HMRC. You can then be paid interest in Gross.