Self Assessment and Savings Interest: Do You Need to Report It

Since banks stopped deducting tax from savings interest in 2016, the responsibility to report and pay tax on savings interest falls on you. Here is when it matters.

The Personal Savings Allowance

For 2026/27:

• Basic-rate taxpayers: £1,000 of savings interest tax-free
• Higher-rate taxpayers: £500 of savings interest tax-free
• Additional-rate taxpayers: No allowance — all savings interest is taxable

When You Need to Report

You need to report savings interest on Self Assessment if:

• Your total savings interest exceeds your Personal Savings Allowance
• HMRC cannot collect the tax through your tax code
• You are already in Self Assessment for other reasons

If you are in Self Assessment, report all savings interest on your return. HMRC applies the allowance in the calculation.

Where to Find Your Interest Figures

Your bank provides annual interest statements or certificates. Most banks also report your interest directly to HMRC. Check your online banking for the annual summary.

Impact of Higher Interest Rates

With interest rates significantly higher than a few years ago, many people are exceeding their Personal Savings Allowance for the first time. If you have significant savings and are self-employed, include the interest in your Self Assessment return.

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