Our methodology
Every number on GILT Calculator is computed from live market prices using the formulas below. We publish this so you can trust — and verify — what you see.
Running yield
The running (or current) yield is the annual coupon divided by the current clean price, expressed as a percentage: (coupon ÷ price) × 100. It measures income return only and ignores any capital gain or loss at redemption.
Yield to maturity (YTM)
YTM is the single discount rate that sets the present value of all future coupons plus the redemption value equal to the bond's current price. We solve for it numerically using the Newton–Raphson method, assuming semi-annual coupon payments (the standard for UK gilts) and a £100 par value.
Accrued interest & dirty price
Between coupon dates, interest accrues to the seller. We estimate accrued interest from the time elapsed since the last coupon and add it to the clean price to give the dirty price — the amount you would actually pay.
Capital gains and tax
Capital gains on UK gilts are exempt from Capital Gains Tax, so we treat the pull-to-par capital movement as tax-free. Only coupon income is taxed; net figures apply your chosen tax rate (20% by default) to coupon income only.
Index-linked gilts
For index-linked gilts we project the index ratio forward using an assumed inflation rate (3% by default, adjustable in the calculator) and uprate both principal and coupons accordingly to estimate real returns.
Data & limitations
Prices refresh roughly every 15 minutes during market hours. Calculations assume bonds are held to maturity with coupons reinvested, and exclude dealing costs and bid-offer spreads. Figures are estimates for illustration, not advice — capital is at risk.