If your interest is £10,000 or less and you do not file a Self Assessment return, you do not need to tell HMRC: your bank or building society reports the interest after 5 April and HMRC sends you a tax calculation if tax is due.
If you already file a return, put the interest on it. Over £10,000, you must report it on a Self Assessment return.
The advisers for this subject: Sunny Bharj and Tony Springer
After 5 April each year, banks and building societies tell HMRC how much interest they paid you in the tax year just ended.
If tax is due, the calculation arrives by post or in your Personal Tax Account. HMRC's guidance gives June to the following March as the period it sends them in.
If you are employed or have a pension, HMRC changes your tax code to collect what you owe. The code can also carry an estimate of this year's interest, based on last year's.
If you have no tax code, or it cannot be changed, HMRC sends a letter saying how much you owe, how to pay and when.
If tax is due on your 2025/26 interest and no calculation has arrived by 31 March 2027, you must contact HMRC.
Interest above £10,000 in a tax year goes on a Self Assessment tax return. When a bank reports more than £10,000 for you, HMRC sends a notice to file a return.
If you do not already file one, you need to register for Self Assessment.
The estimated interest is shown in your Personal Tax Account. Multiply your average monthly interest by 12 and compare. If HMRC's figure is wrong, contact HMRC and you will be sent a new tax code.
Where you have overpaid in the current year, HMRC asks your employer or pension provider to refund the difference through your pay or pension. For an earlier year, you can claim back tax on interest if your total income was below your personal allowance, within four years of the end of that tax year, using form R40 or your Self Assessment return.
In HMRC's own example, tax on interest earned in 2025/26 is calculated during 2026/27 and collected through the tax code in 2027/28.
No. ISA interest is tax-free and does not use your personal savings allowance. ISAs
Each bank reports its own interest, and HMRC adds the figures together to work out your total for the year.
Report all your savings interest on the return, whatever the amount.
It may include an estimate of tax on this year's interest, or tax owed on last year's. Your Personal Tax Account shows the estimated interest HMRC has used.
If tax on interest is coming out of your pay or pension each year, we can look at where your savings are held and in whose name.
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