Tax on Savings

Dazed_and_C0nfused

sabelu said:

This year my interest on my savings will be c£3k and my wife a little less. We are both retired and our individual income is below £12570 I have read that we get an extra £5k tax free savings allowance as our individual incomes from occupational pensions is below £17.5k.
Do we have to claim for this etc or will no tax be requested from us?

It doesn't make any difference to most people but it's not a £5k "tax free savings allowance".

It's £5,000 of taxable income which is taxed at 0%.

A subtle difference but it makes a difference to a few people.

Same goes for the £1,000 savings nil rate band (aka Personal Savings Allowance).

You have to use these in order, you must use all your Personal Allowance first.

Then can use the savings starter rate band (if available) and only once that has been used can you use the savings nil rate band.