Many customers will have money on deposit either with a bank or building society.

Commercial banks

Commercial banks offer a variety of deposit accounts. Interest, which varies in line with the general level of interest rates, is paid net of 20% tax. Non-tax payers are able to reclaim the tax deducted or arrange to have the interest paid gross. Basic rate tax payers have no further liability and higher rate tax payers will be liable to a further 20% on the gross interest. Additional rate tax payers liable will be liable to a further 10% on the gross interest on top of the higher rate of 20%.

Building societies

Building societies also offer a variety of savings accounts each with different terms and conditions. Interest earned may be fixed for a specified period or vary in line with interest rates generally. Interest will be paid net of 20% tax. The tax position is the same as commercial bank deposit accounts. Some accounts may restrict access to the money in the account and there may be penalties for early withdrawals.

Cash ISA

You can have one cash ISA up to the limit of £5,760 each tax year with one provider and the option of investing the remaining allowance of £5,760 into a Stocks and Shares ISA, the cash ISA can consist of money on deposit enjoying a tax-free environment. The minimum age to own a cash only ISA is 16 attained..

Cash Junior ISAs are now also available. Your child can have a Junior ISA if they:

• are under 18
• live in the UK
• weren’t entitled to a Child Trust Fund (CTF) account

National Savings

National Savings are Government-backed and there are a variety of instruments available. You can visit their website here http://www.nsandi.com/

The Financial Conduct Authority (FCA) does not regulate National savings products