New Starting Tax Rate

Pension

New rules will come into effect from April 2015 regarding how interest received from savings is taxed.

The government announced in their 2014 Budget that they will be cutting the 10% `starting-rate` of tax for savings down to 0%, as well as increasing the amount of savings income to £5,000.

What this all means is that if an individual has income of less than their personal allowance (£10,600), plus £5,000 (totalling £15,600), they will be able to register for tax-free savings with their bank or building society.

To see if you are eligible, HMRC have produced an online calculation checker which can be found here.