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STOP PRESS: At Spring Budget 2024, the Chancellor announced that the remittance basis would be abolished from 6 April 2025, although this only applies to foreign income and gains arising on or after that date. The remittance basis rules still apply to unremitted income and gains arising before that date but remitted later. For more details, see the Abolition of the remittance basis from 2025/26 guidance note.

‘Gilts’ are securities that are also known by a number of different names (eg gilt-edged securities, Government securities or treasury stock).

The Government sells gilts to fund the deficit between public spending and tax receipts. Normally, the Government pays interest to the holder of the gilt and the interest rate varies considerably depending on the issue. The rate can be fixed or linked to the retail prices index.

Interest on gilts bought on or after 6 April 1998 is payable gross (unless an application is made by the holder to the Bank of England for net payment).

Interest from gilts is savings income for the purposes of the income tax calculation,