This section of the Savings and Investment Income Manual explains the taxation of interest received by individuals and trustees. It covers the legal definition of interest, inclusions and exemptions from the statutory charge, and explains who is chargeable. It also covers the sale of interest rights.
The charge to tax
There is no statutory definition of ‘interest’. In most cases, it is readily apparent that someone has received interest. The charge to income tax on interest is contained in Chapter 2 of Part 4 of ITTOIA05 at section 369, which includes the following.
•Interest from UK bank, building society and other savings accounts