Basic-rate taxpayers can then receive £1,000 tax-free under the new personal savings allowance. Higher-rate, 40 per cent taxpayers get £500 and top-rate 45 per cent taxpayers get nothing.

If you owe tax on earnings above this level, you have to pay it. But thats where it gets messy.

Though with NSamp;I you cant touch your money for three years - unless you pay a stiff penalty - it adds interest to your account each year. And it immediately becomes liable to tax.

An NSamp;I spokesman told Money Mail: The liability for tax will arise when the interest is added to the account, regard-less of the fact customers may not cash in until the end of the term.

If you put the full £10,000 into the account, you will earn £400 interest before tax in the first year.

As a basic-rate taxpayer, you could owe £80 tax, depending on whether you have savings interest from other accounts on top.

In year two, your return rises to £416 (4 per cent on £10,000 plus the £400 interest added to the account), giving a tax bill of £83.20.

In the third year, your interest is £432 with £86 tax due. But at least by this time, you will have got your money back.