UK savers gained more than £100m in saved tax by investing in National Savings and Investments products over the fiscal year to April, according to figures published by the executive agency.
By putting money into products such as Savings Certificates and Fixed Interest Savings Certificates earned retail investors an estimated £580m in interest, of which £116m would have been taken by tax if it had not been for the tax free status of these products, NS&I says.
However, the tax saved came on interest rates that are well below what retail investors could, for example, get from a cash-only ISA.
For example, the 5-year 77th issue fixed interest savings certificate from NS&I promises an interest rate of 3.65% - some 85 basis points below the current Bank of England base rate.
The benefit of NS&I’s savings certificates is that greater sums can be invested than in a cash mini-ISA.IFAonline
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