Savings Interest Calculator
Calculate your net savings interest after tax for 2025/26. See how the Personal Savings Allowance applies, compare ISA vs taxable accounts, and find the best home for your savings across easy access, fixed term, ISA, Premium Bonds, and NS&I.
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How to Use This Calculator
Savings Interest tab
Enter your total savings amount, the interest rate (AER) your account pays, and your income tax band. The calculator shows your gross interest, how much falls within the Personal Savings Allowance (PSA), any taxable interest, the tax owed, and your net interest after tax. Expand "More options" to check eligibility for the starting rate for savings (available if your non-savings income is below £17,570).
ISA vs Non-ISA tab
Compare a Cash ISA (tax-free) with a standard savings account (taxable after PSA). Enter the rates for each, your tax band, and the comparison period. The calculator shows the break-even point where the ISA overtakes the non-ISA despite a potentially lower headline rate, and calculates the minimum ISA rate needed to match the after-tax return of a higher-rate taxable account.
Best Place for Savings tab
See how your savings would perform across six different options: easy access, fixed term, Cash ISA, Fixed ISA, Premium Bonds, and NS&I Direct Saver. Each product is compared on net interest (after tax where applicable), access restrictions, and deposit protection. The calculator ranks them by net return for your tax band.
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The Formula
UK savings interest tax is calculated by applying the Personal Savings Allowance and your marginal tax rate:
Starting Rate for Savings (if eligible) = min(Gross Interest, £5,000 − (Non-Savings Income − £12,570))
PSA Available = £1,000 (basic) / £500 (higher) / £0 (additional)
Taxable Interest = Gross Interest − Starting Rate Used − PSA Used
Tax Owed = Taxable Interest × Tax Rate (20% / 40% / 45%)
Net Interest = Gross Interest − Tax Owed
The Personal Savings Allowance was introduced in April 2016. It lets basic rate taxpayers earn up to £1,000 in savings interest tax-free, and higher rate taxpayers up to £500. Additional rate taxpayers (income above £125,140) receive no PSA.
The starting rate for savings is a separate 0% tax band worth up to £5,000. It is available only when non-savings income (employment, pensions, rental income) is below £17,570. For every £1 of non-savings income above the Personal Allowance of £12,570, the £5,000 band reduces by £1.
Example
Sarah — Marketing Manager, 34, Manchester
Sarah earns £42,000 (basic rate taxpayer). She has £25,000 in a savings account paying 4.5% AER. She wants to know how much tax she will owe on the interest.
Savings Interest tab
Sarah's first £1,000 of interest is covered by her PSA. Only £125 is taxable, costing her £25 in tax. HMRC will typically collect this by adjusting her tax code, so she does not need to file a Self Assessment return.
ISA vs Non-ISA tab
If Sarah moved £20,000 into a Cash ISA paying 4.0% instead, she would earn £800 tax-free. Her remaining £5,000 in the taxable account at 4.5% earns £225, all covered by her PSA. Total: £1,025 with no tax at all. However, keeping the full £25,000 at 4.5% in a taxable account gives £1,100 net after tax — so in Sarah's case, the higher non-ISA rate wins because most of her interest falls within the PSA.
If Sarah were a higher rate taxpayer (PSA only £500), she would owe £125 in tax on the taxable account — making the ISA the better choice.