Built to save you money
Personal bank accounts, country by country
What each account costs, what your savings actually earn, how that interest is taxed, and the wrapper in each country that keeps it out of tax altogether. Plus the traps when you open the account, and the ones that cost you every month after that.
Countries compared
5
UK, US, Australia, Canada and New Zealand.
Tax-free option in each
Named per country
Cash ISA, TFSA, the savings allowance, offset and withholding rates.
We are paid nothing
No commission
No bank here pays Taxmiser, so nothing is ranked for money.
Personal banking
United Kingdom
Everyday current accounts are normally free, and the money is made on overdrafts and currency. Savings rates vary hugely between the same bank's own accounts, so the loyal saver is usually the worst paid.
| Account | Fee | Rate | Cards and cash | Abroad | Tax on the interest | Best for |
|---|---|---|---|---|---|---|
| Free current account, high street or app bankEveryday accountFCA guidance on current accounts | 0 pounds a month | 0 to about 3 percent on small credit balances only | Free debit card, free UK cash machine withdrawals | App banks often at the mid-market rate. High street banks commonly about 2.75 percent | Any interest counts towards your personal savings allowance and is reported to HMRC by the bank | Day to day money, direct debits and salary |
| Cash ISATax-free wrapperGOV.UK, Individual Savings Accounts | 0 pounds | Variable easy access or a fixed term, published per provider | Usually no card, transfers in and out only | Not designed for spending | Interest is completely free of income tax and never needs declaring | Anyone whose interest is at risk of tipping over the savings allowance |
| Easy access savings, best buy rather than same bankSavings accountNS&I, government-backed comparison point | 0 pounds | Headline rates published daily, often several points above an old account | No card | Sterling only | Taxable interest, paid gross, reported to HMRC | The money set aside for the January tax bill |
If the bank fails
FSCS
85,000 pounds per person per banking licence, and 170,000 pounds on a joint account. Several brands share one licence, so check the licence rather than the name.
Official schemeWhat they will ask for
- Photo ID, usually a passport or driving licence
- Proof of a UK address, such as a council tax bill or a tenancy agreement
- National Insurance number for anything that pays interest or is tax free
Keeping the interest tax free
A cash ISA pays interest with no tax at all, up to the annual subscription limit. Outside one, the personal savings allowance covers 1,000 pounds of interest for a basic rate taxpayer, 500 pounds at higher rate and nothing at the top rate, and the starting rate for savings can cover up to 5,000 pounds more on a low income.
Watch out when you open it
- A switch bonus usually needs two or more direct debits and a minimum pay-in, and it is taxable if it is interest rather than a gift.
- Opening several accounts in a short window leaves a run of credit searches on your file.
- A joint account links your credit file to the other person, and it stays linked after the account closes unless you ask for a notice of disassociation.
Watch out while you use it
- Overdraft interest is priced around 35 to 40 percent a year, which is dearer than most credit cards.
- The easy access rate on an old account often falls to well under 1 percent while the same bank advertises far more to new savers.
- Debit card spending abroad usually carries a non-sterling fee of about 2.75 percent plus a cash machine charge, unless the account says otherwise.
The trap that costs most here: Leaving a large balance in an account paying almost nothing. The lost interest is usually far bigger than any tax you would have paid on it.
Personal banking
United States
Big bank checking accounts carry a monthly fee that is waived if you keep a minimum balance or a direct deposit. Online banks and credit unions charge nothing and pay far more on savings.
| Account | Fee | Rate | Cards and cash | Abroad | Tax on the interest | Best for |
|---|---|---|---|---|---|---|
| Online checking accountEveryday accountFDIC, choosing an account | 0 dollars a month | Little or nothing on the checking balance | Free debit card, large fee-free cash machine networks, some refund out-of-network charges | Some online banks charge no foreign transaction fee, big banks about 3 percent | Interest reported on Form 1099-INT and taxed as ordinary income | Everyday spending, pay and bills |
| High-yield savings accountSavings accountConsumer Financial Protection Bureau | 0 dollars | Headline annual percentage yield, published and variable | No card, transfers only | Dollars only | Ordinary income federally, plus state tax in most states | The money held back for April and the quarterly estimates |
| Credit union share accountEveryday accountNCUA insurance | 0 dollars, small share deposit to join | Dividends published per credit union, often above big bank savings | Shared branch and shared cash machine networks | Varies, ask before travelling | Dividends are taxable interest, reported the same way | Anyone paying big bank fees or refused elsewhere |
If the bank fails
FDIC and NCUA
250,000 dollars per depositor per insured bank per ownership category. Credit unions get the same cover through the NCUA.
Official schemeWhat they will ask for
- Social Security number or an ITIN
- Government photo ID and a US address
- An opening deposit, often 25 to 100 dollars at a branch bank
Keeping the interest tax free
Bank interest is ordinary income at your federal rate, plus state tax in most states, and it is reported on Form 1099-INT. Interest on US Treasury bills is free of state and local tax, and municipal bond interest is normally free of federal tax, which is often better than a savings account for a large balance.
Watch out when you open it
- A cash bonus for opening is taxable and arrives on a Form 1099-INT, so it belongs on your return.
- Some banks screen new customers through a banking history report, and a past overdrawn account can get you refused.
- Confirm the account is at an FDIC-insured bank, not a payments app holding your money elsewhere.
Watch out while you use it
- Overdraft and non-sufficient funds fees run around 30 to 35 dollars a time and can stack in one day.
- Out-of-network cash machine charges are commonly 3 dollars from the machine plus 2 to 3 dollars from your own bank.
- Debit card foreign transactions usually cost about 3 percent unless the account says otherwise.
The trap that costs most here: The monthly maintenance fee. A 12 dollar fee is 144 dollars a year for nothing, and it is avoidable at almost every online bank or credit union.
Personal banking
Australia
Everyday transaction accounts are free at the major banks. Savings pay a low base rate plus a bonus that only lands if you meet monthly conditions, so most people quietly earn the base rate.
| Account | Fee | Rate | Cards and cash | Abroad | Tax on the interest | Best for |
|---|---|---|---|---|---|---|
| Everyday transaction accountEveryday accountMoneysmart, bank accounts | 0 dollars a month at the major banks | Usually nothing | Free debit card, free withdrawals at your own bank's machines | Commonly about 3 percent on purchases, plus a fixed overseas withdrawal fee | Any interest is ordinary income and pre-filled into your ATO return | Pay, bills and everyday spending |
| Bonus saver accountSavings accountMoneysmart, savings accounts | 0 dollars | Low base rate plus a bonus if you deposit monthly and make no withdrawals | No card | Dollars only | Ordinary income at your marginal rate, tax file number reported | Money you can genuinely leave alone each month |
| Home loan offset accountEveryday accountMoneysmart, offset accounts | Often part of a packaged loan fee | Effectively your mortgage rate, as saved interest | Usually a card and full transaction access | As the linked transaction account | No interest is earned, so there is nothing to tax | Anyone with a mortgage and savings at the same time |
If the bank fails
Financial Claims Scheme
250,000 dollars per account holder per authorised deposit-taking institution, guaranteed by the government.
Official schemeWhat they will ask for
- Photo ID, and the 100 point identity check if you open in a branch
- Tax file number, or the bank withholds tax on your interest at the top rate
- An Australian address and phone number
Keeping the interest tax free
Interest is ordinary income at your marginal rate, and joint account interest is split by ownership. If a partner is on a lower rate, holding the savings in their name lawfully lowers the tax on that interest. Paying down a home loan through an offset account earns you the loan rate with no tax at all, which usually beats a savings account.
Watch out when you open it
- If you do not give your tax file number, the bank must withhold tax at the top marginal rate plus Medicare levy, and you only get it back through your return.
- Bonus savings rates usually require a deposit each month and no withdrawals, and one withdrawal loses the whole month's bonus.
- Introductory rates often run for four months only, then drop to the base rate.
Watch out while you use it
- Overseas card purchases usually carry about 3 percent, and overseas cash withdrawals add a fixed fee on top.
- Foreign cash machine operators add their own charge, which your bank does not control.
- Interest is paid to your tax file number and pre-filled into your ATO return, so forgetting to declare it is spotted automatically.
The trap that costs most here: Missing the monthly bonus conditions. Dropping from a bonus rate to a base rate on a large balance costs far more than any account fee.
Personal banking
Canada
The big banks charge roughly 4 to 17 dollars a month unless you hold a minimum balance. Online banks and credit unions charge nothing and pay more on savings.
| Account | Fee | Rate | Cards and cash | Abroad | Tax on the interest | Best for |
|---|---|---|---|---|---|---|
| No-fee online chequing accountEveryday accountFinancial Consumer Agency of Canada | 0 dollars a month | Usually nothing | Free debit card, access to a shared cash machine network | Commonly about 2.5 percent on purchases | Interest is taxable and reported on a T5 above 50 dollars | Everyday banking without a balance requirement |
| Tax-free savings account, held in cashTax-free wrapperCRA, TFSA | 0 dollars | Provider's published savings rate, tax free | No card | Dollars only | No tax on the interest and nothing to declare | Any savings that would otherwise be taxed at your top rate |
| High-interest savings accountSavings accountCDIC coverage | 0 dollars | Published and variable, promotional rates time limited | No card | Dollars only | Fully taxable interest, T5 slip issued | Money held for the 30 April balance or instalments |
If the bank fails
CDIC
100,000 dollars per depositor per member institution, per insured category, so registered accounts are covered separately from ordinary ones.
Official schemeWhat they will ask for
- Two pieces of accepted identification
- Social insurance number for any account that pays interest or is registered
- A Canadian address, though newcomer programmes exist
Keeping the interest tax free
Interest is fully taxable at your marginal rate, worse than dividends or capital gains. Interest inside a TFSA is never taxed and never has to be declared, and an FHSA does the same for a first home, so use the room before an ordinary savings account.
Watch out when you open it
- A promotional rate usually lasts a few months only, then drops to the standing rate.
- Monthly fee waivers depend on holding a minimum balance every single day, not on average.
- A TFSA has a personal contribution room figure, and going over it is penalised at 1 percent a month on the excess.
Watch out while you use it
- Cash machine charges outside your own network run about 2 to 3 dollars plus the operator's own fee.
- Foreign card purchases usually carry about 2.5 percent on top of the exchange rate.
- Interac e-Transfer limits and paper statement fees are easy to trip over on a basic plan.
The trap that costs most here: Paying a monthly fee at a big bank while an online bank offers the same everyday banking for nothing and pays more on savings.
Personal banking
New Zealand
Everyday accounts often carry a small monthly plan fee at the main banks, sometimes waived for students or over-65s. Savings accounts pay a base rate with a bonus for saving without withdrawing.
| Account | Fee | Rate | Cards and cash | Abroad | Tax on the interest | Best for |
|---|---|---|---|---|---|---|
| Everyday transaction accountEveryday accountSorted, bank accounts | 0 to about 5 dollars a month depending on the plan | Usually nothing | Debit card, free withdrawals at your own bank's machines | Offshore transaction fee around 1.9 to 2.5 percent | Interest taxed through resident withholding tax at your chosen rate | Wages, bills and everyday spending |
| Bonus saver accountSavings accountInland Revenue, resident withholding tax | 0 dollars | Base rate plus a bonus for a monthly deposit and no withdrawals | No card | Dollars only | Resident withholding tax deducted at source | Provisional tax money you will not touch |
| Term depositSavings accountReserve Bank of New Zealand | 0 dollars | Fixed for the term, published per bank | No card, locked for the term | Dollars only | Resident withholding tax on the interest when it is paid | A known tax bill on a known date |
If the bank fails
Depositor Compensation Scheme
Up to 100,000 dollars per depositor per licensed deposit taker, run by the Reserve Bank of New Zealand.
Official schemeWhat they will ask for
- Photo ID, usually a passport or New Zealand driver licence
- IRD number, or resident withholding tax comes off your interest at the no-declaration rate
- Proof of a New Zealand address
Keeping the interest tax free
Interest is taxed through resident withholding tax at the rate you choose, so pick the rate that matches your income and you avoid both an unexpected bill and an interest-free loan to Inland Revenue. A KiwiSaver contribution attracts the government top-up, which is a far better return than any savings rate.
Watch out when you open it
- Without an IRD number and a chosen resident withholding tax rate, tax is taken at the highest no-declaration rate of 45 percent and you have to claim it back.
- Choosing a resident withholding tax rate below your real rate leaves you with tax to pay at the end of the year.
- Bonus saver conditions require a monthly deposit and no withdrawal, and one withdrawal loses the month.
Watch out while you use it
- Overseas card purchases usually carry an offshore transaction fee of around 1.9 to 2.5 percent.
- Some everyday plans charge per transaction once a monthly allowance is used up.
- Interest is reported to Inland Revenue against your IRD number and pre-populates your income, so it cannot be quietly left out.
The trap that costs most here: Leaving the wrong resident withholding tax rate on the account. Too low and you owe money later, too high and Inland Revenue holds your cash all year.
True in every country
- The bank you have had longest almost never pays you the best rate. New money gets the headline rate, old money gets the base rate.
- Interest is income. It is reported to the tax authority against your tax number in all five countries, so a savings account is never hidden money.
- Deposit protection is per banking licence, not per brand or per account. Two accounts at brands sharing one licence share one limit.
- Card spending abroad is where a free account quietly becomes expensive. Check the foreign transaction fee before a trip, not after it.
- A cash bonus for switching is usually taxable where it is paid as interest, and it never makes up for a poor ongoing rate on a large balance.