Tesco Compare offers a comparison service in conjunction with lovemoney.com limited. lovemoney.com limited ensures that all companies listed have met with their requirements. Details of their criteria can be found by clicking here. All institutions listed by lovemoney.com limited belong to the Financial Services Compensation Scheme (FSCS) full details can be obtained online from www.fscs.org.uk. The FSCS safeguards deposits of up to £50,000 per financial institution, so if your savings exceed this amount you may wish to consider saving any additional amounts with an unrelated organisation.
If you're a UK tax payer, it's likely that you'll have to pay tax on the interest you earn. There are some exceptions; cash ISAs and some National savings products are often exempt from tax. The amount of tax you'll have to pay will depend on whether you are a basic rate or higher rate tax payer. Interest earned on offshore accounts must also be declared on your tax return. For detailed personalised advice you should contact an Independent Financial Adviser or tax specialist.
AER stands for Annual Equivalent Rate and illustrates what the interest rate would be if interest was paid and compounded once each year. As every advertisement for a savings product which quotes an interest rate will contain an AER, you will be able to compare more easily what return you can expect from your savings over time.
The Gross rate is the contractual rate of interest payable before the deduction of income tax. When the interest rate for e.g. a Cash ISA is described as 'tax free', this means that the contractual rate of interest (Gross rate) payable is exempt from income tax.
A dormant account is an account that has been inactive for an extended period of time and where the provider has been unable to make contact with the account holder. A dormant account can be reactivated or the money claimed back on application to the provider or by using the online claim form on mylostaccount.org.uk which is a free central tracing scheme.
Interest can be paid to you monthly, quarterly, half yearly or annually, it depends on the type of savings account you have chosen. Generally speaking, accounts offering interest more frequently than annually will be a slightly lower rate. A monthly interest account usually requires the interest to be paid to another account may be suitable for anyone who wishes to supplement their monthly income. Interest rates are usually dependent on meeting the terms and conditions that apply to the specific account. Examples could be making regular payments within a minimum or maximum agreed amount, or giving a months notice before making a withdrawal.
With some accounts, namely fixed rate accounts (bonds or ISAs), you'll have to pay a penalty fine if you withdraw money from your savings before the term ends. The penalty amount is typically a percentage of the total amount withdrawn; alternatively you may have to close the account. Before deciding upon a savings account, think about how much access to your money you'll need over the next few years. If you are able to avoid withdrawals, you should be able to benefit from a higher rate of interest.
ISA stands for Individual Savings Account and they are designed to give tax free saving. There are two types of ISA, cash ISA and Stocks and Shares ISA. The maximum amount you can pay into them is £10,680 per tax year. Up to £5,340 of this can be put into a cash ISA per tax year, or the full amount could go into a Stocks and Shares ISA. You do not have to declare any income received from them. Please note that lovemoney.com provide a comparison service for Cash ISAs only as a Stocks and Shares ISA is an investment product, not a savings product.
The savings account comparison service is provided by lovemoney.com limited. Registered in England and Wales, company no. 07406028, 2nd Floor, 112–116 Old Street, London, EC1V 9BG. UK residents only.
The links below contain useful information on savings accounts. Alternatively Get a Quote to start comparing.