Receiving interest without deduction of tax

If you are not a taxpayer because your total income is less than your tax free personal allowance, you can ask the bank or building society to pay your interest without deducting tax. You need to complete form R85 and hand it in to your bank or building society.

With joint accounts where interest is received without deduction of tax, it is important to re-check the position if either party to the account dies. This is because the R85 declaration for gross interest may not longer be valid.

There is more information about Bank and Building Society interest on the HMRC website at http://www.hmrc.gov.uk/tdsi/key-info.htm