Building societies and banks (and other deposit-takers) are required by law to deduct 20 per cent Income Tax from the interest they pay to savers. This tax then goes to HM Revenue & Customs (HMRC).
Some savers may be able to claim back from HMRC all the tax deducted from their interest, because they are not due to pay any tax. Other savers may be able to claim back some of the tax deducted, because the amount taken off their interest is more than they are due to pay.
Savers who think their taxable income will probably be less than the amount they can have before they start to pay tax can register to receive their interest in future without tax deducted.
This is called receiving interest 'gross'.