Tax liability on 'with profit' account

N1ck_K

In October I put savings into a one-year fixed term Sharia account.  The profit is added at the end of the term so, as I see it, at the end of this tax year it will have generated no additional revenue (if I cashed it in on 5 Apr '21 I would only get back my original investment).  Will I have to declare any interest on this account for the 2020/21 tax year? 

This is relevant because for the '20/'21 tax year I am taxed at 40% whereas in the 2021/22 tax year, having given up work, I will be in the 20% bracket and my personal savings allowance will have increased.  

eskbanker

As with standard interest accounts, the tax liability only arises when it's actually added to the account, so if that's next October then it'll fall within 2021/22.