Latest News for Savers

Personal Savings Allowance

On 6 April 2016, the Government introduced the Personal Savings Allowance (PSA), a tax-free allowance of £1,000 (or £500 for higher rate taxpayers) on the interest that you earn on your savings. For 95% of us in the UK, this means we get to keep all of our savings interest.

How does the Personal Savings Allowance benefit me?

  • As a result of the introduction of the PSA, all banks and building societies, including Aldermore, no longer deduct income tax from the interest earned on your non-ISA savings
  • If your annual income is less than £17,000, you get to keep all your savings interest and won’t have to pay tax on it
  • If you’re a basic rate tax-payer, with an income up to £45,000 p.a., the first £1,000 of savings interest you earn will be tax free
  • If you’re a higher rate tax-payer, with an income between £45,001 to £150,000 p.a., the first £500 of savings interest you earn will be tax free
  • If your annual income is more than £150,000, the Personal Savings Allowance won’t apply to you
  • Your Personal Savings Allowance is in addition to your annual ISA allowance and any interest you receive from ISAs doesn’t count towards your Personal Savings Allowance

What do I have to do?

  • The Section 975 Certificate, which showed the tax deducted from interest earned, no longer applies. From the 2016/2017 tax year onwards, we’ll provide you with a Summary of Interest in its place
  • If the interest you earn is less than your Personal Savings Allowance, you don’t have to do anything
  • If your savings interest exceeds the new allowance, you will need to pay tax on the excess amount. HMRC will normally collect the tax by changing your tax code in the PAYE system. If you fill in a Self Assessment tax return you should carry on doing this as normal. For further details on how tax will be collected, visit

ISA changes for this tax year

For the 2017/2018 tax year, the ISA allowance has increased from £15,240 to £20,000

What does that mean for me?

  • At the start of each new tax year (6 April), every adult receives an ISA allowance. This year the allowance has increased significantly from £15,240 to £20,000
  • The ISA allowance is a separate allowance to the Personal Savings Allowance and any interest received in respect of ISAs does not form part of your PSA
  • In addition a new type of ISA, the Lifetime ISA, has now been introduced. You can split your annual ISA allowance across the different types of ISAs – Cash ISA, Stocks and Shares ISA, Innovative Finance ISA and Lifetime ISA – provided that you don’t exceed your annual allowance in total