Chancellor's savings tax raid ensnares almost twice as many as last year

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Nearly 1.8m people are now paying tax on interest earned from their savings.

Article originally published by The Telegraph. Hargreaves Lansdown is not responsible for its content or accuracy and may not share the author's views. News and research are not personal recommendations to deal. All investments can fall in value so you could get back less than you invest.

Published by

18 Jul 2023

The number of Britons paying savings tax has almost doubled in just one year, figures show.

Close to 1.8m people are now paying tax on interest earned from their savings.

Just 972,000 taxpayers paid tax on their savings in the 2021-2022 tax year, but the number jumped to 1,770,000 in 2022-23. The last time the figure was more than one million was in 2019-2020.

The figures, obtained under the Freedom of Information Act, come after official data showed HMRC raked in £3.4billion from the Chancellor’s raid on savings.

More people are being caught out while the savings allowance remains frozen, despite rising savings rates and high levels of inflation.

Savers are now paying close to £2,000 a year in savings tax, up from £1,271 last year ––a jump of almost £700.

Laura Suter, head of personal finance at stockbroker AJ Bell, which obtained the figures, said: “Nobody should be punished for holding a rainy day savings pot, and doubling the personal savings allowance