Do you keep your savings under the mattress??

Do you keep your savings under the mattress??

Figures announced claim that a staggering quarter of a trillion pounds is sitting in low interest bank accounts with rates of under 1%.

While savers are clearly losing out, they also risk facing an unexpected tax bill as income tax is charged on all bank interest unless it is held in an ISA and Bank of England figures show that £253bn is held in low interest bank accounts.

This also raises serious tax concerns for savers as the personal savings allowances have been frozen for years.

Individuals pay tax on interest they earn on cash savings that exceed the personal savings allowance, which currently stands at £1,000 for basic rate taxpayers and £500 for higher rate taxpayers.

Additional rate taxpayers get no exemption and pay tax on all cash interest they receive and although many savers are failing to take advantage of high interest rates, there is a vast amount of money in accounts collecting interest.