More people are paying tax on their savings. Here's why
These figures, obtained by Nottingham Building Society, highlight a "growing and often hidden tax burden on ordinary savers", primarily driven by fiscal drag due to frozen tax thresholds and inflation.
While government rules allow for tax-free personal allowances and a "savers' allowance" of up to £5,000 interest, experts say the system is complex and emphasise the value of tax-efficient Individual Savings Accounts (ISAs).
Nottingham Building Society is urging the government to simplify and strengthen cash ISAs, rather than introducing new barriers.
A Treasury spokesperson affirmed the government's commitment to protecting the £20,000 tax-free yearly ISA limit, ensuring most people continue to pay no tax on their savings.
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