Frequently Asked Questions

Savings interest is money that you earn on savings. The amount of interest you earn is determined by the rates set by your provider.

Depending on your circumstances and the type of savings account you have, you may have to pay tax on any interest you earn. This is because interest on savings is classed as earnings. There are some types of savings accounts that allow you to earn interest without paying tax on it (such as ISAs), but there are restrictions on how much you can save in these accounts each year. Before opening an account, it is a good idea to understand the terms and conditions, and any restrictions associated with the savings account.

Bonus rate savings accounts are designed to encourage (and reward) savers who don’t dip into their savings. If you don’t make withdrawals, you receive a bonus interest rate, meaning that you will earn more interest on your balance.

This depends on the savings account. Most instant access savings accounts are just that - instant access. But there are some accounts that require days, weeks or even months notice, and some will impose a penalty that can be the equivalent of several months interest, depending on your savings balance. Before you open a savings account, make sure you think about how often you may need to dip into your savings, and understand the account provider’s policies to prevent a costly mistake.