Our range / Income Bonds /

How they work

Income Bonds provide you with a monthly income at a competitive variable interest rate, with no risk to your capital.

• Income
• New - easy access
• Interest
• Bonus interest
• Who can invest
• Tax
• Investment limits
• 100% security
• Cheque and debit card clearance
• About the terms and conditions
• Protecting your personal information
• Banking Code

Income

We'll pay your income directly into your bank or building society account or, if you prefer, into your NS&I Investment Account or Easy Access Savings Account, on the 5th of every month (or the next working day if the 5th falls on a weekend or bank holiday). Just tell us when you apply which account you would like your income paid into.

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New - easy access

You can cash in your Bonds at any time with no notice and no penalty. All you have to do is complete the form on the back of your certificate of investment and return it to us. To cash in a Bond held jointly, both investors need to sign. We'll repay your money within a few days, either directly to your bank/building society account or by warrant (like a cheque).

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Interest

Your money will earn interest daily, and we'll start calculating it from the day we receive your application and payment. The rates are variable so may change from time to time. We will give details of any change by putting a notice in a range of national newspapers. We will also write to you personally to let you know. Click here for details of current interest rates or pick up our interest rates leaflet from any Post Office® branch.

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Bonus interest

Obviously, the more you invest in Income Bonds, the higher the income you'll receive each month. But investing more has an additional bonus - if you invest £25,000 or over, we'll pay a higher rate of interest. You can check the current interest rates here, or pick up our interest rates leaflet from any Post Office® branch.

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Who can invest?

Anyone aged seven or over can invest in Income Bonds, either individually or jointly with one other person. Bonds can also be bought on behalf of children under seven. They can also be bought by trustees for up to two personal beneficiaries of any age.

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Tax

Although the interest is taxable, we don't deduct the tax - so if you're a non-taxpayer you don't have to fill in an Inland Revenue form to receive your interest gross.

If you are a taxpayer you will need to declare your interest to the Inland Revenue. We'll send you a statement before the end of May each year, showing how much interest you've received.

Click here to find out more about tax and savings.

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Investment limits

You can invest anything from £500 to £1 million, either individually or jointly.

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100% security

Any money you invest in Income Bonds is 100% secure. National Savings and Investments can make this promise, because our investments are backed by HM Treasury.

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Cheque and debit card clearance

If you buy your Bond by cheque or debit card, your payment will be cleared on the 7th working day (ie excluding weekends and English bank holidays). Bonds can only be cashed in after your payment has cleared.
 
For example, if we receive your cheque or debit card details on a Monday, your payment will be cleared on the Tuesday of the following week. Allow one additional day for each English bank holiday.

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About the terms and conditions

Please read the terms and conditions before you invest. If we make any changes to the terms and conditions after you invest, we will let you know. If any change is to your disadvantage, we will tell you personally at least 30 days before the change. In this case you can switch to another product or cash in your Bond, without notice or penalty, within 60 days of us telling you.* For any other changes, we will let customers know by putting a notice on this website and in a range of national newspapers.

* Please note, this does not apply to changes of interest rate, which will be notified on this website, in Post Office® branches and in a range of national newspapers.

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Protecting your personal information

When you become a customer of ours, we will treat all the personal information we hold about you as private and confidential. Click here for details on our privacy policy. 

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Banking Code

As part of our commitment to providing you with a high standard of service, National Savings and Investments subscribes to the Banking Code. If we make a mistake we'll aim to put things right quickly and without fuss. And if you have a complaint, we have a procedure designed to resolve it fairly. Click here for further details of the Code or our complaints procedure.

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