Skip to main content

Find the best cash ISA rates - ISA comparison

An Individual Savings Account (ISA) can help you maximise your tax-free savings, but what should you look for in an ISA, what are the best ISA rates, and how do you find the best ISA?
Share this guide
woman holding jar of coins signifying savings
Woman holding jar of coins

Is your money in the best ISA account?

Find and compare ISAs and choose the best cash ISA rates with our partner

Are you earning enough interest?

It could be time to find a new savings account, find and compare ISAs with our partner

What are the best cash ISA interest rates available?

The best cash ISA rates for you will depend on many factors, including what type of access to your money you want to have.

What is a cash ISA?

Cash ISAs (Individual Savings Accounts) are tax-free savings accounts. They are a good place to start if you want to build up tax-free savings for the future. You can save up to £20,000 in the 2020/21 tax year.

Everyone aged 16 or over can have a cash ISA. If you want to combine your cash savings with an investment in stocks and shares, you could consider a Stocks & Shares ISA, but you have to be 18 to open one of these. A Stocks & Shares ISA enables you to invest in the stock market, whereas a Cash ISA is ideal if you want to keep your savings in cash.

Alternatively, if you want the best Cash ISA rates, but you also would like some exposure to the stock market, then you can divide your ISA allowance across a Stocks & Shares ISA and Cash ISA. Or you can choose to put the whole £20,000 in either one.

You can still open or contribute to a Cash ISA if you have a small amount of money to invest. You don't need to put the whole of the £20,000 in one go, or in any one year. However, if you don't use up your ISA allowance you can't carry the unused portion forward to the next tax year.

How do cash ISAs work?

You can contribute up to £20,000 into your Cash ISA within any one tax year, which runs from April 6 to April 5. This is known as your annual ISA allowance. You can add to your ISA each year, either by making regular payments or by making a one-off lump sum Cash ISA contribution.

What types of cash ISA are there?

  • Instant access (or easy access) cash ISA

  • Notice cash ISAs

  • Fixed-rate cash ISAs

  • If you want to lock up your savings for a while, you might want to consider a fixed-rate cash ISA. These lock away your money for a set period, usually between one and five years, and in return pay you a higher interest rate.

However, at the moment interest rates generally are very low, so the difference between rates from a a simple instant access ISA account to a fixed rate ISA account is not very large. It may be that you don't want to tie up your money for a long time in a fixed rate Cash ISA account, because the interest rate is just not high enough to justify locking away your money for so long.

Are you earning enough interest on your Cash ISA?

As interest rates are low, it pays to shop around. Now could be the time to find a new savings account, find and compare ISAs with our partner

Are you earning enough interest?

It could be time to find a new savings account, find and compare ISAs with our partner

How can I move my ISA to an account with better interest?

Transferring your ISA to an account with a higher rate of interest has now become far easier. You can find out about the best cash ISA transfer options and why it could be a good move to switch.

Why should I transfer my Cash ISA?

Interest rates are very low at the moment, because the Bank of England has set the base rate at a very low level.

For this reason, many people may find that the interest rate on their cash ISA has fallen way below what it was when they took out their account.

In these difficult financial times, it's more important than ever to make the most of your tax-free cash ISA allowance, making sure you get the best cash ISA transfer interest rate.

For example, if you had £10,000 in a cash ISA paying a rate of 1.5% AER, you would earn £150 in tax-free interest per year. However, if you were to switch a better account, paying 2.5% AER, this would increase by £100 to £250 interest a year.

Check to see what rate your ISA is paying, if it doesn't match up to the best interest rates available, then it's time to switch.

How do I transfer my ISA?

It's far easier to transfer your ISA than you might think. The most important thing to remember is that should never just withdraw your money from your ISA - or you will lose all your tax-free benefits. Instead, you need to transfer all the money from one ISA provider to another - don't close down an ISA in order to open a new one, as that will wipe out all the tax-free allowances you have built up over the years.

To transfer your ISA, when you have opened your new ISA account, ask your old ISA provider for an ISA transfer form and give them your new account details - this will ensure that your bank treats it as an ISA transfer, not an account closure.

Alternatively, when you open your new account, your new provider may be able to arrange to transfer your old ISA for you. Ask them first whether they provide this service for you.

Be aware that not all new ISA accounts allow you to transfer your existing ISA savings. The best rates tend to be for ISA accounts where you cannot transfer, so check this before you apply.

How long does it take to transfer my cash ISA?

The transfer times for ISAs were changed in 2010 when the Office of Fair Trading (OFT) ruled that cash ISA transfers were to take no more than 15 days.

This was a significant improvement on the old system where your money may have disappeared for up to two months before resurfacing in your new ISA. The ruling also asked banks to continue paying the interest throughout the transfer time.

What is the best cash ISA transfer interest rate?

Always make sure you compare the different savings accounts on offer before you transfer your ISA. You can compare cash ISAs with Uswitch and compare them by a range of factors, including the interest rate and minimum investment, to find the cash ISA that's right for you.

How can I tell if I have got the best rate on my Cash ISA?

Once you have opened an ISA, check rates regularly to make sure you are still earning a high interest rate - many ISA rates drop sharply after 12 months. The best Cash ISA rates may be offered to new customers, and so there is an incentive for your to switch Cash ISA accounts if you want to make sure that you are getting the best rates.

If you are looking for the best fixed rate cash ISA, or you just want to compare Cash ISAs and find the best ISA on the market, then it pays to review your rates every six to 12 months, and certainly as your fixed term comes up for renewal.

Top Cash ISA rates tend to change regularly. Often the best Cash ISA transfer deals are offered to new customers. It pays to check the comparison tables regularly, because the providers at the top of the best buy tables for Cash ISA rates move around.

If you're looking for the best Cash ISA rates for the over 50s or over 60s, or you are searching for easy access Cash ISAs, or instant Cash ISA deals, then you can use our comparison tool to find the best Cash ISA that fits your requirements.

Our Cash ISA calculator can find the best rates for you based on the criteria you input. So if you want the best one year fixed rate Cash ISA for example, you can view the providers who offer this product and see which is paying the best rate.

Read more …