Premium Bonds
Premium Bonds calculator: what a typical year of prizes looks like
Enter the Bonds you hold, your other income and the rate a taxable account would pay. The tool draws 4,000 simulated years from the current prize table and puts the after-tax interest beside them.
Premium Bonds against a taxable savings account
Median prizes in a year
£925
| Average (prize fund rate) | £1,087 |
| 1 year in 10, below | £575 |
| 1 year in 10, above | £1,500 |
| Savings account after tax, 2027/28 | £790 |
| Chance of no prize all year | 0.00 % |
Prize fund rate 4.35 %, odds 21,000 to 1, October 2026 prize table, 4,000 simulated years. Not a forecast.
Premium Bonds pay no interest: each £1 Bond goes into a monthly draw, and NS&I sets the size of the prize fund so that it averages 4.35 % a year across all Bonds, with odds of 21,000 to 1 per Bond per month (NS&I, Premium Bonds). That average is not what a typical holder receives. On £25,000, the prize fund rate works out at about £1,087 a year, but in our simulation of the October 2026 prize table the median year brings £925, one year in ten brings £575 or less and one in ten brings £1,500 or more. Prizes are free of income tax, so the fair comparison is with interest after tax: £25,000 at 4 % for someone earning £55,000 leaves £790 in 2027/28, when savings rates rise under the Finance Act 2026. Prizes are never guaranteed, and the money itself is backed by HM Treasury.
Sums checked by Radif Partners · Editorial policy · How the sums are done
Average and typical are two different numbers
A prize draw has a lopsided spread. Most months a Bond wins nothing; when it does win, the prize is usually one of the three smallest values. The large prizes are so rare that they hardly ever arrive, yet they carry a real slice of the fund. The table below runs the same simulation as the tool for five holdings. The second column is the prize fund rate applied to the holding; the third is the year that sits in the middle of the 4,000 draws.
| Holding | Average a year | Median year | 1 year in 10, below | 1 year in 10, above | No prize at all |
|---|---|---|---|---|---|
| £1,000 | £43 | £0 | £0 | £100 | 56.5 % |
| £5,000 | £217 | £150 | £25 | £350 | 5.7 % |
| £10,000 | £435 | £350 | £150 | £650 | 0.3 % |
| £25,000 | £1,087 | £925 | £575 | £1,500 | 0.0 % |
| £50,000 | £2,175 | £1,875 | £1,350 | £2,725 | 0.0 % |
Two patterns stand out. Small holdings often end the year with nothing: the median for £1,000 is £0. And the gap between the median and the average narrows as a share of the holding when the holding grows, but it never closes, because a £25 or £50 prize is far more common than anything above £1,000. NS&I publishes how each month's fund is shared out in its monthly prize allocation; the table here uses the October 2026 figures.
Against a taxable account, after tax
Interest on an ordinary savings account is taxable once your allowances are used up, while Premium Bond prizes are not taxed at all. Comparing a prize figure with a headline interest rate therefore flatters the account for anyone who pays tax on savings. The next table sets a £25,000 holding against the same sum earning 4 %, which is £1,000 of interest a year, at three levels of other income, with the 2027/28 rates from section 5 of the Finance Act 2026.
| Other income | Account at 4 % after tax, 2027/28 | Bonds, median year | Higher of the two |
|---|---|---|---|
| £30,000 | £1,000 | £925 | Account |
| £55,000 | £790 | £925 | Bonds (median) |
| £130,000 | £530 | £925 | Bonds (median) |
A basic rate taxpayer keeps £1,000 of the interest because the £1,000 Personal Savings Allowance covers it all (GOV.UK, how much interest is tax free). At £55,000 the allowance halves and the rest is taxed at 42 %, leaving £790. The result depends on the rate you can find, which changes often, and on the prize fund rate, which NS&I has moved before (it stood at 3.3 % with odds of 23,000 to 1); the page on the prize fund rate turns this into a single taxable rate for your band.
What the tool does not cover
Bonds can be bought from £25 up to £50,000 per person, by anyone aged 16 or over, or by a parent or guardian for a younger child. Every pound is backed by HM Treasury, which is why the Financial Services Compensation Scheme limit does not apply to them. The tool ignores inflation and assumes the current rate and odds hold for a year. For the chance of winning in a given month rather than the amount, see the odds page; to set a cash ISA against a taxable account instead, use the main ISA calculator.