Premium Bonds

Premium Bonds offer your clients a serious investment together with the fun and excitement of a chance to win tax-free prizes.

  • Rate
    1.00%
  • Minimum
    £25
  • Maximum
    £50,000
  • Odds of winning for each £1 Bond number
    34,500 to 1

The amount that your clients can invest is £50,000, giving investors more chances to win tax-free prizes. In addition to this ERNIE picks two £1million jackpot winners.

Who is this suitable for?

  • Clients wanting the chance every month to win a £1 million jackpot and other tax-free prizes
  • Clients wanting to make the most of tax-free investment opportunities
  • Clients that have £25 or more to invest
  • Clients who want 100% security for their money
  • Clients who want to buy them as a gift for a child under 16
  • Clients who want the option to invest either online or by phone or post

Who is this not suitable for?

  • Clients wanting a regular income from their savings
  • Clients who are looking for guaranteed returns
  • Clients who are concerned about inflation eroding the value of their savings
  • Clients who want to invest jointly with someone else or in trust

FAQs about Premium Bonds

  • How is the Premium Bond prize fund calculated?

    We hold a prize draw every month with two £1 million jackpots. We set the size of the prize fund by calculating one month’s interest on the total value of all eligible Bonds, at the annual prize fund interest rate. All prizes are free from UK Income Tax and Capital Gains Tax.

  • How can my firm apply to run the ‘Premium Bond Jackpot Winner Advice Service’?

    A new contract was awarded to Matrix Capital in February 2018, running for three years from 1 April 2018, with the option of two additional 12-month periods. In March 2021 we reviewed the situation and decided to take up this option, and the contract will now run until 31 March 2023. In Autumn 2022 we will issue communications to the industry about the tender process for the new contract.

  • Does buying Premium Bonds in a sequence increase the chances of winning?

    It’s a popular myth that holding Premium Bonds in a sequence can improve your chances of winning, but this simply isn’t true. The machine we use to generate the numbers for each prize draw—ERNIE—generates numbers completely at random, which are then matched to our database of eligible Bonds to determine the winners. Since no Bonds are actually entered into ERNIE, it doesn’t ‘know’ anything about the Bonds themselves, such as whether the Bond number is part of a sequence of numbers or not. The only thing that can increase your chances of winning is holding more Premium Bonds – but holding them in sequence won’t make any difference.

  • Do only people in the South East of England win the £1million jackpot?

    No. Since we introduced the £1 million jackpot prize in 1994, we’ve seen winners in every country in the UK and every county in England, as well as five winners living outside of the UK. It may appear that the South East wins more than any other area, but that’s because there are more Bonds held there compared with the rest of the UK.

  • Can Premium Bonds be held in a Trust?

    No. Premium Bonds were designed as a tax-free product and the maximum holding limit gives individuals the opportunity to have a potential tax-free return by way of the prize draw. The Premium Savings Bond Regulations do not allow for Premium Bonds to be invested in trust as the investment was created for individuals to invest in. Only solely named individuals can invest in Premium Bonds - the regulations do not allow joint investors or any organisation, whether incorporated or unincorporated, to invest in Premium Bonds as this would go against the intention of the investment.

  • Can Premium Bonds be held in a SIPP or SSAS?

    No. Premium Bonds were designed as a tax-free product and the maximum holding limit gives individuals the opportunity to have a potential tax-free return by way of the prize draw. The Premium Savings Bond Regulations do not allow for Premium Bonds to be invested in trust as the investment was created for individuals to invest in. Only solely named individuals can invest in Premium Bonds - the regulations do not allow joint investors or any organisation, whether incorporated or unincorporated, to invest in Premium Bonds as this would go against the intention of the investment.

Adviser email updates

Adviser email updates offer the quickest, easiest way to stay up to date with the latest news on our products, interest rates and other important developments affecting advice firms.

In order for us to send you adviser email updates, please provide your contact details.