With November’s Budget fast approaching, Gary Walker Wealth Management is looking to help people get tax smart.
Each week we’re highlighting a different allowance or relief that can help you make the most of your money.
Last week we discussed ISAs, and this week, we’re looking at the Personal Savings Allowance.
Click here to download the full guide.
Savings rates have improved in recent years, which is good news for savers — but it also means more people risk paying tax on their savings interest. That’s where the Personal Savings Allowance (PSA) comes in.
As the guide explains: “The Personal Savings Allowance (PSA) means you don’t have to pay tax on some of the interest you receive from your cash savings accounts.
"Your annual allowance is based on the rate at which you pay Income Tax, as follows: Basic-rate taxpayers – £1,000 a year; Higher-rate taxpayers – £500 a year; For additional-rate taxpayers, it’s £0, meaning all interest is subject to tax.”
For many people, the allowance covers what they earn in interest. But for higher-rate taxpayers, the margin is tighter.
That’s why it’s important to think carefully about where your money is held.
Keeping some cash aside for emergencies is sensible — but for longer-term goals, a Stocks & Shares ISA may be worth considering, as it offers greater potential for growth while being tax-efficient.
The takeaway? Know your allowance, keep your emergency cash in place, but don’t let inflation and tax quietly erode your savings.
Click here to download Gary Walker’s full guide to smart tax planning. Alongside ISAs, you’ll find insights on the Personal Savings Allowance, pensions, Inheritance Tax, and Capital Gains Tax – all designed to help you stay ahead this tax year.