Tax on savings interest

Benny2020

Received a letter today from HMRC asking me to fill in a BBSI form as they believe i have unpaid tax on my savings interest.
Just done a quick tot up and i earned about £605 in interest in the last tax year.
Got made redundant last July and earned £22135 and paid £4381 tax and believe i am entitled to some tax back as i did not earn anything 
else in the last year except £1900 JSA, could this be why they are asking about interest paid? 
Am i allowed to earn £605 interest tax free?

eskbanker

You'll have a £1,000 personal savings allowance but this is strictly a nil-rate band of taxable income, i.e. taxed at 0% rather than 'tax-free' as such.

However, the fact that they're aware of savings interest and are seeking validation of the value doesn't necessarily mean that you'll be expected to pay any extra tax, or that this compromises any refund due - they'll just be looking to get a comprehensive picture of your tax position before assessing whether you've over- or underpaid....