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The Guardian - UK
The Guardian - UK
Business
Rupert Jones

Don’t get caught out by tax on cash interest, UK savers told

A collection of modern British banknotes surrounding the HM Revenue and Customs heading on a UK government tax form.
Basic-rate taxpayers can receive £1,000 of interest each financial year without paying any tax, while higher-rate taxpayers can receive up to £500. Photograph: George Clerk/Getty/iStockphoto

Higher interest rates look set to land hundreds of thousands more people with an unwelcome tax bill for their savings, a financial advice firm warned this week.

A couple of years ago it was typically only the wealthiest with very big nest eggs who had to pay tax on their savings interest – but now someone with an emergency savings pot of about £8,000 could find themselves falling foul of this little-known tax trap.

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