What is considered legal tender in the UK?
In England and Wales, the only legal tenders are Royal Mint coins (pounds and pence) or Bank of England notes (£5, £10, £20 and £50 notes).
In Scotland and Northern Ireland, only Royal Mint coins are legal tender, not bank notes. Seven banks in Scotland and Northern Ireland issue pound sterling notes for local circulation, but they are not legal tender anywhere, nor are Bank of England notes legal tender in Scotland or Northern Ireland.
That said, you can still, for example, pay with English notes in Scotland or Scottish notes in England if the retailer agrees to take them. That’s because they are the same currency (pound sterling) and can be deposited at the bank or Post Office.
To qualify as an actual ‘legal tender transaction’, the debtor has to offer the exact amount owed, as the merchant is not required to offer change (another reason why it’s okay to refuse large bank notes for small purchases).
There are also certain rules about acceptance of small coins to qualify as legal tender:
- 1p and 2p coins only count for amounts up to 20p
- 5p and 10p coins only count for amounts up to £5
- 20p and 50p coins only count for amounts up to £10
£1 coins and £2 coins are legal tender for any amount, as are all Bank of England notes as long as the exact amount owed is given.
Bank of England notes and Royal Mint coins stop being legal tender when withdrawn and replaced with a new version of the coin or bank note. Typically, the public gets several months’ notice of this.