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FAQs / Savings questions


What is the interest rate on my account?

Your product terms and conditions will detail what the interest rate on your specific account is.

Alternatively, you can log in and find it on your account summary screen.


Do I pay tax on my interest?

It is your responsibility to declare and pay the required tax on your interest.

The government introduced the Personal Savings Allowance in 2016 which allows you to earn a certain amount of tax-free interest on your savings dependant on your tax bracket.

Learn more about the Personal Savings Allowance

All your interest from ISA savings is tax-free. However, the annual ISA allowance limits how much money you can deposit into an ISA every year. For the tax year 2020/2021 the limit is £20,000.

Learn more about the ISA allowance


How is interest calculated and paid?

Interest is calculated daily, compounded and paid gross on either a monthly or annual basis. When your interest is paid depends on your Product Terms & Conditions and your interest instructions.


Where your Product Terms & Conditions allow, you can choose to have your interest paid annually or monthly. You can have it paid to your Paragon account, to another account with us that accepts additional deposits or to your nominated bank account.

Your interest will be paid on the anniversary of your opening deposit every year or every month. If your anniversary falls on a non-business day it’ll be paid the next business day.


What is the difference between AER and Gross Annual rate?

AER stands for Annual Equivalent Rate and illustrates what the interest rate would be assuming that interest is paid into the account once per year. We advertise this on our products as it’s a regulatory dictated measure under BCOBs.


AER is usually the same as the Gross Annual Rate however, with some of our savings accounts and ISAs, such as our 18 month accounts, choosing annual interest will result in interest payments being credited to the account after 12 months, and then again at the end of the term. This is a more frequent payment of interest than a purely annual payment and the slightly raised AER reflects the value of this additional compounding.


How do I change my interest instructions?

You can choose how you’d like your interest paid either annually or monthly. Where you’d like it paid to: your current Paragon account, your nominated bank account or another Paragon account. Subject to your product terms and conditions.

If you’re an online account holder you can change your interest instructions easily online. Simply log in to your account and select “manage account” and “account details”.

If you change your instructions you must do so before 5pm at least one working day before your interest is paid for it to take effect that month.

If you’re a postal account holder, please write to us including your username and account number to change your interest instructions. Or download, print and return a Change of interest form.

Change of interest instruction form

Return to: RTEX-LLUT-KKKE (freepost), Paragon, PO Box 850, Wallsend NE28 5BJ


What if my rate changes?

We will contact you before the interest rate changes on your account.

If the rate goes down, we will contact you 14 days before hand. If your account has a notice period longer than 14 days, we will notify you in line with your required notice period. If you don’t choose to close your account, we’ll assume you’re happy to accept the changes.

If the interest on your variable rate account increases, we’ll let you know as soon as possible, this might be after the new rate is applied.


How can I get my annual certificate of interest?

While you hold an online account with us, you can generate an interest statement online for any of your accounts, Simply login to your account, select “manage account” and “interest statement” from your account summary screen.

You can also find the closing statement and summary of interest for your closed accounts by selecting “closed accounts”.

If you’re a postal account holder, we will post you an annual certificate of interest, or you can request a certificate of interest by calling us on 0800 052 2222


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Customer reviews

See the reviews Paragon customers have written about our savings accounts and services.

Paragon Bank PLC is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Registered in England number 05390593. Registered office 51 Homer Road, Solihull, West Midlands B91 3QJ. Paragon Bank PLC is registered on the Financial Services Register under the firm reference number 604551