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The Personal Savings Allowance is how much interest you can earn tax-free from a savings account, bond, or P2P loan. It’s £1,000 if you’re a basic rate taxpayer (your annual income is less than £50,270) or £500 if you’re a higher rate taxpayer.
If your annual income is over £150,000, you’re considered an additional rate taxpayer and don’t get a Personal Savings Allowance.
This allowance doesn’t apply to interest earned from ISA accounts or Investment Bonds. Interest earned from them is always tax-free.
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