The yield curve plots each conventional gilt’s gross redemption yield against the date it matures. Every point is a real gilt you can buy, placed at its exact maturity rather than rounded to a standard term, so you can see what lending to the UK government earns for anything from a few months to around fifty years.
A gilt pays a fixed coupon twice a year, taxed as income, and repays £100 at maturity. Buy below £100 and the gain to £100 is free of capital gains tax. So the after-tax (net) yield depends on how much of a gilt’s return comes from coupons. Two gilts maturing in the same year can have almost the same gross yield but very different net yields: a low-coupon gilt trading well below £100 gets most of its return as tax-free gain, while a high-coupon gilt near £100 gets most of it as taxable income. That is why the net bars jump up and down along a smooth gross curve — and why, for a higher- or additional-rate taxpayer, the best gilt for a given date is often not the one with the highest headline yield.
Short-dated gilts behave much like cash: their price barely moves when interest rates change, and held to maturity they repay a known amount on a known date. Long-dated gilts lock in a yield for decades but their prices are far more sensitive to interest rates — a 1% rise in yields can cut a 30-year gilt’s market value by 15% or more. If you hold to maturity you still get £100 back; if you might sell early, that sensitivity matters. You can see each gilt’s duration in the gilt table and the exact price change for a 1% move on Compare.
The grey line is the Bank of England’s average easy-access savings rate after the same income tax. Where a gilt’s net bar sits above it, that gilt keeps more after tax than an average savings account — and its rate is fixed to maturity, while a savings rate can change at any time. Savings interest is taxed in full, gilt gains are not, so the gap usually widens at higher tax rates. Tax on savings income, gilt coupons included, rises by 2 percentage points from 6 April 2027; every net figure here already allows for it.
Ready to use it? Build a gilt ladder for cash on specific dates, see the best gilts for higher-rate taxpayers, or read how gilts are taxed.
Information only — not financial advice. Gilt prices are indicative from last available close and may be delayed. Verify before transacting. UK tax treatment depends on your circumstances and may change.