How to do some serious bonding

National Savings offer a wide range of schemes at good interest rates and are safe - you are banking with the British Government, which doesn't like to lose voters. But recent falls in interest rates offered by banks, building societies and insurance companies has allowed the Treasury to cut rates on national savings, too.

Capital Bonds - a five-year investment - can be bought with pounds 100 but you can hold up to pounds 250,000 worth. The interest rate on the latest issue (26 January) has been cut to 6.65 per cent, is paid gross but is not tax- free, so if you are a taxpayer, you have to pay tax on it. If you cash the bonds in during the first year, you receive no interest.

The age for Pensioners Bonds has just been cut to 60, which brought in pounds 423m in December alone as the under-65s rushed to buy them. The minimum investment is pounds 500, the maximum pounds 20,000, and the current issue earns a guaranteed 7 per cent paid gross every month; however, if you are subject to tax, so is it.

First option bonds pay a fixed annual interest rate after basic-rate tax has been deducted at source. The current rate, guaranteed for a year, is 6.25 per cent gross for up to pounds 20,000, which means you will receive 5 per cent net when the tax rate on interest drops to 20 per cent in April. You can invest from pounds 1,000 to pounds 250,000 in these.

Income bonds cost pounds 2,000; you can invest up to pounds 250,000. If you have less than pounds 25,000, the interest, paid gross but taxable, is now 6.25 per cent, and 6.5 per cent if you hold more. Rates will vary in line with base rate.

Children's bonus bonds can be bought only by or for under-16s. They are for five years, and reinvestable, paying a guaranteed 6.75 per cent free of all tax.

Basic NS certificates pay 5.35 per cent tax-free and are guaranteed if held for five years. You can start with pounds 100 and go up to pounds 10,000. Index- linked certificates are much the same but pay interest tax-free at 2.5 per cent above the rate of inflation if held for five years.

Investment accounts can be started with pounds 20 and pay 5 per cent gross (taxable) on less than pounds 500, 5.5 per cent on pounds 500-plus, and 5.75 per cent on pounds 25,000 or more, but a month's notice is needed to withdraw. Maximum investment is pounds 100,000 per account. These rates change if the base rate does.

Ordinary accounts start at pounds 10, and go up to pounds 10,000. You have instant access but earn only 1.75 per cent gross on less than pounds 500 and 2.75 gross on sums over that if the account has been going for a calendar year. The first pounds 70 of annual interest is tax-free.

Independent Partners; request a free guide on NISAs from Hargreaves Lansdown

News
people
News
people
Arts and Entertainment
Keys to success: Andrew and Julian Lloyd Webber
arts + entsMrs Bach had too many kids to write the great man's music, says Julian Lloyd Webber
Voices
Left: An illustration of the original Jim Crowe, played by TD Rice Right: A Couple dressed as Ray and Janay Rice
voices

By performing as African Americans or Indians, white people get to play act a kind of 'imaginary liberation', writes Michael Mark Cohen

PROMOTED VIDEO
News
i100
Arts and Entertainment
Hand out press photograph/film still from the movie Mad Max Fury Road (Downloaded from the Warner Bro's media site/Jasin Boland/© 2014 Warner Bros. Entertainment Inc.)
films'You have to try everything and it’s all a process of elimination, but ultimately you find your path'
Arts and Entertainment
Imelda Staunton as Dolores Umbridge in the Harry Potter films
books

New essay by JK Rowling went live on Pottermore site this morning

News
Russia Today’s new UK channel began broadcasting yesterday. Discussions so far have included why Britons see Russia as ‘the bad guy’
news

New UK station Russia Today gives a very bizarre view of Britain

News
people

Top Gear presenter is no stranger to foot-in-mouth controversy

Arts and Entertainment
Keira Knightley and Benedict Cumberbatch at the premiere of The Imitation Game at the BFI London Film Festival
filmsKeira Knightley tried to miss The Imitation Game premiere to watch Bake Off
Finacial products from our partners
Property search
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    The benefits of Recruitment at SThree...

    £18000 - £23000 per annum + Comission: SThree: SThree, International Recruitme...

    Trainee Recruitment Consultants

    £20000 - £25000 per annum + OTE £35K: SThree: We consistently strive to be the...

    Finance Assistant - Part time - 9 month FTC

    £20000 - £23250 Per Annum pro rata: Clearwater People Solutions Ltd: Pro rata ...

    Marketing Manager

    £40 - 48k + Benefits: Guru Careers: We are seeking a Marketing Manager to join...

    Day In a Page

    The drugs revolution starts now as MPs agree its high time for change

    The drugs revolution starts now as MPs agree its high time for change

    Commons debate highlights growing cross-party consensus on softening UK drugs legislation, unchanged for 43 years
    The camera is turned on tabloid editors in Richard Peppiatt's 'One Rogue Reporter'

    Gotcha! The camera is turned on tabloid editors

    Hugh Grant says Richard Peppiatt's 'One Rogue Reporter' documentary will highlight issues raised by Leveson
    Fall of the Berlin Wall: It was thanks to Mikhail Gorbachev that this symbol of division fell

    Fall of the Berlin Wall

    It was thanks to Gorbachev that this symbol of division fell
    Halloween 2014: What makes Ouija boards, demon dolls, and evil clowns so frightening?

    What makes ouija boards and demon dolls scary?

    Ouija boards, demon dolls, evil children and clowns are all classic tropes of horror, and this year’s Halloween releases feature them all. What makes them so frightening, decade after decade?
    A safari in modern Britain: Rose Rouse reveals how her four-year tour of Harlesden taught her as much about the UK as it did about NW10

    Rose Rouse's safari in modern Britain

    Rouse decided to walk and talk with as many different people as possible in her neighbourhood of Harlesden and her experiences have been published in a new book
    Welcome to my world of no smell and odd tastes: How a bike accident left one woman living with unwanted food mash-ups

    'My world of no smell and odd tastes'

    A head injury from a bicycle accident had the surprising effect of robbing Nell Frizzell of two of her senses

    Matt Parker is proud of his square roots

    The "stand-up mathematician" is using comedy nights to preach maths to big audiences
    Paul Scholes column: Beating Manchester City is vital part of life at Manchester United. This is first major test for Luke Shaw, Angel Di Maria and Radamel Falcao – it’s not a game to lose

    Paul Scholes column

    Beating City is vital part of life at United. This is first major test for Shaw, Di Maria and Falcao – it’s not a game to lose
    Frank Warren: Call me an old git, but I just can't see that there's a place for women’s boxing

    Frank Warren column

    Call me an old git, but I just can't see that there's a place for women’s boxing
    Adrian Heath interview: Former Everton striker prepares his Orlando City side for the MLS - and having Kaka in the dressing room

    Adrian Heath's American dream...

    Former Everton striker prepares his Orlando City side for the MLS - and having Kaka in the dressing room
    Simon Hart: Manchester City will rise again but they need to change their attitude

    Manchester City will rise again but they need to change their attitude

    Manuel Pellegrini’s side are too good to fail and derby allows them to start again, says Simon Hart
    Isis in Syria: A general reveals the lack of communication with the US - and his country's awkward relationship with their allies-by-default

    A Syrian general speaks

    A senior officer of Bashar al-Assad’s regime talks to Robert Fisk about his army’s brutal struggle with Isis, in a dirty war whose challenges include widespread atrocities
    ‘A bit of a shock...’ Cambridge economist with Glasgow roots becomes Zambia’s acting President

    ‘A bit of a shock...’ Economist with Glasgow roots becomes Zambia’s acting President

    Guy Scott's predecessor, Michael Sata, died in a London hospital this week after a lengthy illness
    Fall of the Berlin Wall: History catches up with Erich Honecker - the East German leader who praised the Iron Curtain and claimed it prevented a Third World War

    Fall of the Berlin Wall

    History catches up with Erich Honecker - the East German leader who praised the Iron Curtain and claimed it prevented a Third World War
    How to turn your mobile phone into easy money

    Turn your mobile phone into easy money

    There are 90 million unused mobiles in the UK, which would be worth £7bn if we cashed them in, says David Crookes