Savings Interest Tax Calculator
Estimate ordinary savings-interest tax in a supported England, Wales or Northern Ireland scenario. Show the direct interest tax and any wider allowance-taper effect.
Rule year: 2026/27 · GBP · Sources checked
Estimated tax directly on savings interest
England/Wales/Northern Ireland non-savings income plus ordinary taxable savings interest only; standard allowance and unextended bands. No Scottish income mix, dividends, ISA interest, tax-relief band extension, Gift Aid, pension deductions, foreign withholding credit or joint-account ownership allocation.
For informational purposes only. This estimate is not financial advice, a tax return, a payroll calculation or a lender decision. See the supported circumstances and exclusions below.
How this calculator works
Savings interest can use unused Personal Allowance, a starting-rate slice of up to £5,000, and a Personal Savings Allowance. The starting slice falls as taxable non-savings income rises. The PSA is normally £1,000 for basic-rate, £500 for higher-rate and zero for additional-rate circumstances; zero-rated savings still occupy bands. This supported model allocates Personal Allowance to non-savings income first and interest second. Where total income tapers the Personal Allowance, tax on other income can also increase, so that wider tax change is shown separately.
Formula and rules
Savings starting slice = min(taxable interest, max(0, £5,000 − taxable non-savings income)). Direct interest tax = ordinary band tax(non-savings + taxable interest) − ordinary band tax(non-savings + zero-rated savings slices).
Assumptions and limitations
England/Wales/Northern Ireland non-savings income plus ordinary taxable savings interest only; standard allowance and unextended bands. No Scottish income mix, dividends, ISA interest, tax-relief band extension, Gift Aid, pension deductions, foreign withholding credit or joint-account ownership allocation.
Worked example
£17,570 non-savings income uses the £12,570 allowance and leaves £5,000 taxable, removing the savings starting-rate slice. With £6,000 interest and a £1,000 PSA, £5,000 interest at 20% gives £1,000 direct interest tax.
- Estimated tax directly on savings interest
- £1,000.00
- Total Income Tax increase including allowance taper
- £1,000.00
- Starting-rate savings slice used
- £0.00
- Personal Savings Allowance available
- £1,000.00
Official sources and review
Reviewed against the sources below on 2026-10-06. Rates are held in versioned rule modules. Versioned rules, official source review and year-specific calculation tests.
- GOV.UK: tax on savings interest ↗
Personal Allowance, £5,000 starting-rate band and £1,000/£500/£0 Personal Savings Allowance.
- GOV.UK: Income Tax rates and Personal Allowances ↗
2026/27 allowance £12,570, taper above £100,000, and income bands.
Common questions
Does the PSA extend the basic-rate band?
No. Zero-rated savings occupy the band even though no tax is charged on that slice.
Why show total tax change as well as interest tax?
Interest can reduce Personal Allowance above the ANI threshold, increasing tax on other income. The two amounts can then differ.
Can I include Scottish earnings or dividends?
This version deliberately supports an E/W/NI non-savings-plus-interest scenario. Other income mixes require additional ordering and regional rules.