Compare Cash ISA deals!
A Cash ISA can be a good way of saving money, as ISAs usually offer a higher interest rate than standard savings accounts, and is not subject to tax.
Deposit Plan Offer
Looking for a Capital Protected alternative to Cash?
Potential 24.05% after 3 years
- Potential 24.05% if the FTSE 100 rises by any amount after 3 years
- Equivalent to 8.02% per year
- 3 year term
- Available as cash ISA, non ISA or ISA transfer
- Capital Protected – receive your initial capital back at the end of the term no matter how the FTSE 100 performs
Cash ISA Top Sellers
With savings rates continuing to fall, it’s important for savers to remain alert for the best current cash ISA deals. To help you stay one step ahead, see our selection of top selling cash ISA options for your 2018/19 cash ISA allowance, which is £20,000.
How do cash ISAs work?
A cash ISA acts as tax ‘wrapper’, protecting your cash from taxation each year. Under the 2018/19 ISA allowance of £20,000, individuals are permitted to save all or part of this amount in a cash ISA. With a cash ISA, money is placed on deposit and all interest is paid gross without any tax having been deducted. You can put money into a your cash ISA as a lump sum, in regular amounts, or a combination of both – as long as your total contributions for the tax year don’t exceed that year’s allowance.
What kind of cash ISA should I choose?
There are several different types of cash ISA to chose from, so do your research to make sure you pick one that suits you:
- An instant access cash ISA offers straightforward access to emergency savings.
- A fixed rate cash ISA can sometimes provide a better rate of return for those prepared to lock their money away for a set period of time.
- Structured deposit plans – which offer index-linked while also offering capital protection – are becoming a popular way for people to use their cash ISA allowance.
Find the account with the best cash ISA rates can really make a difference to your savings – there are some competitive deals available which help your money grow, so if your current provider is not offering you the best cash ISA rates available, switch to another one to get a better rate and make the most of your cash ISA allowance.
As with all savings accounts, it’s important that you shop around for the best deal. Use the tables below to help you compare our selection of the latest cash ISA deals, and make sure you’re getting the most from your 2018/19 cash ISA allowance.
What is a cash ISA?
The cash ISA limit for the 2024/25 tax year is £20,000 per person and you need to be a UK resident or Crown employee aged 16 or over to open an account.
You can only have one cash ISA per tax year, but you can also have a different type of ISA, known as a stocks and shares ISA, simultaneously.
What are the benefits of a cash ISA
- No income tax – you don’t pay tax on any interest you earn from the cash in your ISA
- Easy access – if you choose an instant access cash ISA (rather than a fixed-rate cash ISA) it’s a convenient way to save at a good interest rate while retaining fast and easy access to your money, should you need it
- No need to declare – you don’t need to declare your cash ISA on your tax return
- Straightforward transfers – you can transfer your cash ISA to a different provider to get a better rate of interest.
How much can I save with a cash ISA?
- Saving rate taxpayers – you would usually pay 10% tax on interest earned from your savings. In a cash ISA this savings interest is tax-free
- Basic rate taxpayers – you would usually pay 20% tax on interest earned from savings. In a cash ISA this savings interest is tax-free
- Higher rate taxpayers – you would usually pay 40% tax on interest earned from savings. In a cash ISA this savings interest is tax-free
- Additional higher rate taxpayers – you would usually pay 50% tax on interest earned from savings. In a cash ISA this savings interest is tax-free.
How do I choose a cash ISA?
There are several factors to consider when choosing a cash ISA:
- Do you want easy access to your money? An instant access ISA might be the right choice for you, as long as you’re willing to accept a slightly lower rate of interest
- Are you happy to lock away cash for a set period of time? Fixed-rate cash ISAs might be a better option as they have the potential to offer a greater return long-term
- Do you have a lump sum to invest, or are you planning to make small regular payments? Different ISA providers offer different minimum deposits ranging from just one pound to several thousand pounds
There is no single ‘right’ cash ISA choice for everyone – it’s a case of weighing up the different factors and considering which product and provider best meets your overall needs.
6 Cash ISA Tips
- You can only have one type of cash ISA in each financial year, so research your options carefully. Whether you choose a fixed-rate or instant access cash ISA, give some thought to your savings goals beforehand to help you determine what’s right for you
- Remember that you can’t carry your tax-free allowance over from one financial year to the next – so if you’ve got enough cash to hit your limit, stash it in an ISA. The cash ISA allowance for the financial year 2024/25 is £20,000.
- Because a cash ISA operates on a year-long basis, it’s a good way to try your hand at saving without committing yourself to anything long-term. It’s also a great way to save for a specific event like a wedding, holiday, or starting a family
- Once you’ve set up your cash ISA, make sure you still keep an eye on the interest rates available from other providers. You can usually switch cash ISA providers without incurring any charge
- To make life easier, set up a direct transfer from your current account into your cash ISA to make sure that you put aside a certain amount each month without fail
- Don’t forget that you’ve got the option of opening a stocks and shares ISA, too. For more on this, see our page on stocks and shares ISAs.
Can I transfer my cash ISA to a new provider to get a better deal?
But remember that if you withdraw your cash and then open another ISA, you will lose all your tax-free benefits.
To transfer an ISA without losing any tax benefits, ask your new ISA provider to arrange the transfer of funds on your behalf.
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