Personal Savings Allowance
The UK-wide £1,000, £500 or nil savings nil-rate amount and its rate-band classification.
The UK-wide £1,000, £500 or nil savings nil-rate amount and its rate-band classification.
Savings nil-rate amounts
Reviewed · Current · Law · From 6 April 2016
£1,000
£500
£0
The savings nil-rate amount is £1,000 without higher- or additional-rate income, £500 with higher-rate but no additional-rate income, and nil with additional-rate income.
Commonly called the Personal Savings Allowance, this is a 0% rate rather than a deduction. The income still occupies its band position. Scottish and Welsh taxpayers are classified using the hypothetical main-rate treatment required by section 12B.
Exceptions and branches
- The classification counts savings income in its rate-band position even where part is charged at 0%.
- Trustees, estates and non-individuals use other rules.
At-a-glance savings nil rate
| Rate-band classification | Savings charged at 0% |
| --- | ---: |
| No higher- or additional-rate income | £1,000 |
| Higher-rate but no additional-rate income | £500 |
| Any additional-rate income | £0 |
The Personal Savings Allowance is legally a 0% rate, not a deduction. That savings income still occupies its basic, higher or additional band position. Its classification is UK-wide: section 12B applies the hypothetical main-rate test to Scottish and Welsh taxpayers.
Related concepts
Linked from
Sources
-
Income Tax Act 2007, section 12A — Section 12A. Primary authority.
-
Income Tax Act 2007, section 12B — Section 12B. Primary authority.
-
Finance Act 2016, section 5 — Section 5. Primary authority.
-
HMRC Savings and Investment Manual SAIM1080 — Starting rate for savings; Personal Savings Allowance. Official guidance.
-
HMRC PAYE Manual PAYE130025 — Savings nil-rate band for Scottish and Welsh taxpayers. Official guidance.
Knowledge version: sterling-knowledge@2026-09-11.7. Last checked 11 September 2026.