| Your income tax band | Net real yield | Savings equiv* |
|---|---|---|
| No tax | 2.146% | — |
| Basic 20% | 1.781% | — |
| Higher 40% | 1.415% | — |
| Additional 45% | 1.324% | — |
Real yields are returns above RPI inflation. The coupon (including its inflation uplift) is taxed as income; the inflation uplift on the principal is free of CGT. Figures don't include your Personal Savings Allowance. How we calculate this.
T38 is the UK index-linked gilt "1¾% Index-linked Treasury Gilt 2038", maturing 22 September 2038. Both its coupon and its principal are uplifted by RPI inflation, so the quoted real yield of 2.146% is the return you earn on top of inflation. At its 11 Sep 2026 price of £95.83 (clean, before inflation adjustment) that is roughly a 5.65% nominal-equivalent yield if RPI averages 3.5%. The inflation uplift on the principal is free of capital gains tax; the (inflation-uplifted) coupon is taxable as income. That is index-linked gilt tax treatment in practice. Whether this beats a conventional gilt of the same maturity depends on whether RPI runs above the break-even inflation rate over its life. Note: UK index-linked gilts have no deflation floor — sustained deflation can reduce the redemption value below par.
Prices are indicative closing levels for 11 Sep 2026 and may be delayed — see the live gilt table for current figures at your tax rate. Information only, not financial advice.
Information only — not financial advice. Gilt prices are indicative from last available close (11 Sep 2026) and may be delayed. Verify before transacting. UK tax treatment may change.