NS&I Green Savings Bond

Want2BeDebtFree

dgpur said:

DRS1 said:

Ignorant question but if you get more than £10k of interest in a year aren't you supposed to do a self assessment tax return?

Yes, though there are other criteria as well. https://www.gov.uk/check-if-you-need-tax-return

Terrifying!   I've never in my life had to do a "self assessment" because my [very large] company would always deduct at source before my retirement.  I knew it was potentially taxable when I took it out.  

Just to add to all of this confusion,  I took out a 1 year Chase Bank Account interest account in October of this year (2025) because it was 4.5% AER Boosted.  That Chase Bank has a lot in it too.  So that "deal" is going to finish at about the same time.  I cannot just have my inheritance sitting in the bog-standard bank doing NOTHING at all...  So what will happen with the CHASE BANK interest in Oct 2025 ?  Will Chase Bank ALSO alert the HMRC ? 

Cheers

wmb194

Want2BeDebtFree said:

dgpur said:

DRS1 said:

Ignorant question but if you get more than £10k of interest in a year aren't you supposed to do a self assessment tax return?

Yes, though there are other criteria as well. https://www.gov.uk/check-if-you-need-tax-return

Terrifying!   I've never in my life had to do a "self assessment" because my [very large] company would always deduct at source before my retirement.  I knew it was potentially taxable when I took it out.  

Just to add to all of this confusion,  I took out a 1 year Chase Bank Account interest account in October of this year (2025) because it was 4.5% AER Boosted.  That Chase Bank has a lot in it too.  So that "deal" is going to finish at about the same time.  I cannot just have my inheritance sitting in the bog-standard bank doing NOTHING at all...  So what will happen with the CHASE BANK interest in Oct 2025 ?  Will Chase Bank ALSO alert the HMRC ? 

Cheers

Chase pays interest monthly so some will arise in this tax year and some in the next. 

Yes, NS&I and all banks & BS' report interest paid to HMRC.

https://www.gov.uk/guidance/bank-and-building-society-interest-returns

Kim_13

Make sure you are making the most of your ISA allowance in each tax year. Anything earned by an ISA isn’t taxable, doesn’t count toward the £10k interest threshold and doesn’t need to be declared on your tax return.

If you are already using all of your ISA allowance with a Stocks and Shares ISA then ignore this post.

Want2BeDebtFree

Kim_13 said:

Make sure you are making the most of your ISA allowance in each tax year. Anything earned by an ISA isn’t taxable, doesn’t count toward the £10k interest threshold and doesn’t need to be declared on your tax return.

If you are already using all of your ISA allowance with a Stocks and Shares ISA then ignore this post.

Hi there Kim.

Yes me and my husband are both "maxed out" with the 20K Non Taxable ISA for this year,  and also both "maxed out" on the 50K allowance for NS&I Premium Bonds.  So what other Tax Free options do I have?   

Can anyone recommend any Tax Free Options to me to invest?   Rather than having money sitting in a bank... Or sitting in CHASE BANK just ready for the Tax Man to grab it??  Thanks everyone... 

ColdIron

Pensions are the obvious tax free (ish) option. How is yours?

wmb194

Want2BeDebtFree said:

Kim_13 said:

Make sure you are making the most of your ISA allowance in each tax year. Anything earned by an ISA isn’t taxable, doesn’t count toward the £10k interest threshold and doesn’t need to be declared on your tax return.

If you are already using all of your ISA allowance with a Stocks and Shares ISA then ignore this post.

Hi there Kim.

Yes me and my husband are both "maxed out" with the 20K Non Taxable ISA for this year,  and also both "maxed out" on the 50K allowance for NS&I Premium Bonds.  So what other Tax Free options do I have?   

Can anyone recommend any Tax Free Options to me to invest?   Rather than having money sitting in a bank... Or sitting in CHASE BANK just ready for the Tax Man to grab it??  Thanks everyone... 

Another option is low coupon gilts bought below par (£100/100p) e.g., T26A, TN28 and TG29 in the table below and you can hold them to maturity when they're redeemed at par.

Coupons are taxed as interest but capital gains are tax free. You buy them via a stockbroker e.g., Hargreaves Lansdown. At the moment there isn't much in it versus your after tax return with Chase but the difference is you'd lock the gain in whilst Chase's rate is variable.

https://giltsyield.com/bond/

Kim_13

Want2BeDebtFree said:

Kim_13 said:

Make sure you are making the most of your ISA allowance in each tax year. Anything earned by an ISA isn’t taxable, doesn’t count toward the £10k interest threshold and doesn’t need to be declared on your tax return.

If you are already using all of your ISA allowance with a Stocks and Shares ISA then ignore this post.

Hi there Kim.

Yes me and my husband are both "maxed out" with the 20K Non Taxable ISA for this year,  and also both "maxed out" on the 50K allowance for NS&I Premium Bonds.  So what other Tax Free options do I have?   

Can anyone recommend any Tax Free Options to me to invest?   Rather than having money sitting in a bank... Or sitting in CHASE BANK just ready for the Tax Man to grab it??  Thanks everyone... 

A pension of £9K would mean that £3,570 (unused personal allowance) + £5,000 (Starter Savings Band) + £1,000 (Personal Savings Allowance) of interest wouldn't have any tax taken off, assuming those allowances are all unchanged in the budget.

The good thing about Chase Bank is that it pays interest monthly, so it is counting for 25/26 tax year rather than adding to the amount that is taxable in 26/27. NS&I fixes effectively force multiple years of interest into a single tax year, so it would be best to stick to 1 year fixes with them in future.

Are the NS&I bonds joint with your husband? If so, half of the interest would need to be declared and taxed as his (but that may take you just below the Self Assessment threshold, so wouldn't be all bad.)

When the new tax year starts, say mid April (as anything opened on the 6th will probably pay interest on the 5th and be no good) it would be prudent to move anything in Chase to an account that pays interest annually instead (this would take it into 2027/28 so that you should pay less tax as you won't have three years worth of interest for 4 NS&I bonds being paid at once in that year.)

eskbanker

Want2BeDebtFree said:

Yes me and my husband are both "maxed out" with the 20K Non Taxable ISA for this year,  and also both "maxed out" on the 50K allowance for NS&I Premium Bonds.  So what other Tax Free options do I have?   

Can anyone recommend any Tax Free Options to me to invest?   Rather than having money sitting in a bank... Or sitting in CHASE BANK just ready for the Tax Man to grab it??  Thanks everyone... 

Best not to fixate on avoiding tax, and just concentrate on achieving the best net return, i.e. if you're already using the obvious tax-free options and don't wish to commit money to long term options such as pensions or standalone investments, then just make sure that you're getting the best savings rates you can, even if you'd 'only' ultimately receive 80% of it (after allowances fully used).

DRS1

Want2BeDebtFree said:

Kim_13 said:

Make sure you are making the most of your ISA allowance in each tax year. Anything earned by an ISA isn’t taxable, doesn’t count toward the £10k interest threshold and doesn’t need to be declared on your tax return.

If you are already using all of your ISA allowance with a Stocks and Shares ISA then ignore this post.

Hi there Kim.

Yes me and my husband are both "maxed out" with the 20K Non Taxable ISA for this year,  and also both "maxed out" on the 50K allowance for NS&I Premium Bonds.  So what other Tax Free options do I have?   

Can anyone recommend any Tax Free Options to me to invest?   Rather than having money sitting in a bank... Or sitting in CHASE BANK just ready for the Tax Man to grab it??  Thanks everyone... 

But is the taxman going to grab any of it?  You have your personal allowance, the starter rate for savings and the personal savings allowance.  How much of that lot have you used up? And when the NS&I bonds pay out in 26/7 how much of that interest is actually going to be taxed at 20%? Maybe half of it?

eskbanker

Kim_13 said:
A pension of £9K would mean that £3,570 (unused personal allowance) + £5,000 (Starter Savings Band) + £1,000 (Personal Savings Allowance) of interest wouldn't have any tax taken off, assuming those allowances are all unchanged in the budget.

DRS1 said:

But is the taxman going to grab any of it?  You have your personal allowance, the starter rate for savings and the personal savings allowance.  How much of that lot have you used up? And when the NS&I bonds pay out in 26/7 how much of that interest is actually going to be taxed at 20%? Maybe half of it?

The (up to) £5K starter band only applies to those with less than £18,570 of taxable income, including the savings interest, i.e. someone with total taxable income of, say, £19K would only have the £12,570 personal allowance and the £1K personal savings allowance applied to interest. Edit: ignore, see below.