Non-fixed savings account pays interest annually. So would that hit next year's PSA?

pod495

Hi,

Does anyone know a definite answer to this?

If I were to open a savings account next week at the start of the 25-26 tax year which pays interest on the anniversary of its opening (so that would be the start of the 26-27 tax year) then would that interest count towards PSA allowance for the year in which it's paid?

I see some info around talking about fixed savings and their interest counting towards the PSA in the year in which you can access the interest, but I'm not seeing mention of normal non-fixed savings with annual interest.

Thanks,

Robin9

Would not the interest be paid on the anniversary date ?

e.g.  If opened April 7th 2025 - interest paid April 7th 2026 - in 26/27 tax year

InvesterJones

pod495 said:

Hi,

Does anyone know a definite answer to this?

If I were to open a savings account next week at the start of the 25-26 tax year which pays interest on the anniversary of its opening (so that would be the start of the 26-27 tax year) then would that interest count towards PSA allowance for the year in which it's paid?

I see some info around talking about fixed savings and their interest counting towards the PSA in the year in which you can access the interest, but I'm not seeing mention of normal non-fixed savings with annual interest.

Thanks,

Depends when it's reported to HMRC by the bank - given that it's accessible to you (via early withdrawal for eg.) they may report accrued interest in the year.

pod495

Yes I think so and that's what I mean, I think.

And it would seem logical to me that it would count towards to 26-27 PSA...  but all I've found so far doesn't 100%confirm this theory for normal non-fixed accounts.

Barkin

What's the account, and what do the T's&C's say?

I've an account where...

---x----
...interest will be paid annually, on the 31st December and at maturity. 
---x---

so the interest could be paid over 2 different financial years.

pod495

Barkin said:

What's the account, and what do the T's&C's say?

I've an account where...

---x----
...interest will be paid annually, on the 31st December and at maturity. 
---x---

so the interest could be paid over 2 different financial years.

I was currently looking at the Charter Savings bank one.
It does say interest paid annually on anniversary of first deposit.

fuzzzzy

pod495 said:

Hi,

Does anyone know a definite answer to this?

If I were to open a savings account next week at the start of the 25-26 tax year which pays interest on the anniversary of its opening (so that would be the start of the 26-27 tax year) then would that interest count towards PSA allowance for the year in which it's paid?

I see some info around talking about fixed savings and their interest counting towards the PSA in the year in which you can access the interest, but I'm not seeing mention of normal non-fixed savings with annual interest.

Thanks,

If you open the account next week and interest is paid annually on the anniversary of opening then your interest will count towards the 26 - 27 tax year.

If you close the account early then the interest will count towards the 25 - 26 tax year.

EthicsGradient

InvesterJones said:

pod495 said:

Hi,

Does anyone know a definite answer to this?

If I were to open a savings account next week at the start of the 25-26 tax year which pays interest on the anniversary of its opening (so that would be the start of the 26-27 tax year) then would that interest count towards PSA allowance for the year in which it's paid?

I see some info around talking about fixed savings and their interest counting towards the PSA in the year in which you can access the interest, but I'm not seeing mention of normal non-fixed savings with annual interest.

Thanks,

Depends when it's reported to HMRC by the bank - given that it's accessible to you (via early withdrawal for eg.) they may report accrued interest in the year.

They can't report any accurate amount for the 25-26 tax year unless you do close it in the 25-26 tax year. If you haven't closed it before April 6th, 2026, then the amount paid in 25-26 will have been 0; it will be added to the account, and thus accessible, only on the anniversary.

fuzzzzy

pod495 said:

Barkin said:

What's the account, and what do the T's&C's say?

I've an account where...

---x----
...interest will be paid annually, on the 31st December and at maturity. 
---x---

so the interest could be paid over 2 different financial years.

I was currently looking at the Charter Savings bank one.
It does say interest paid annually on anniversary of first deposit.

Charter usually give the option to have interest paid monthly or annually. So if you had it set up as annual interest the interest would be paid on the anniversary and count toward 26-27.

If you wanted some of the interest paid in 25 -26 you could amend the interest instruction within the online portal to pay out monthly, thereby getting interest early without needing to close the account.