Hi,
Bank interest under the Personal Savings Allowance & Starting Rate for Savings will only reduce your tax-free allowances if this reduction does not then cause you to pay tax on your regular employment or pension income.
If you are finding that your pension income is now being taxed as a result of this bank interest deduction, and the Personal Savings Allowance & Starting Rate for Savings have not been automatically applied, contact our Self Assessment team, and we can review your code.
Self Assessment: general enquiries
Thank you.