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The best Cash ISAs

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Last updated on

01 July 2014

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If you want to use some or all of your ISA allowance for this tax year, here are the top Cash ISAs right now.

If you're looking to use your Cash ISA allowance then you're in the right place. However, unfortunately we've got some bad news first: Cash ISA interest rates, like most savings rates, have been steadily falling.

This is mainly due to the Government's Funding for Lending scheme, which allowed banks and building societies to borrow cheaply from the Bank of England. As a result, they don't need money from savers, so they've slashed their rates.

Things may improve as the Funding for Lending scheme is now targeted at lending to small businesses, rather than reducing mortgage rates. Indeed, since this announcement the rates on long-term fixed rate ISAs have improved slightly. 

Below we've picked out the best rates for new Cash ISAs for this tax year. You're now able to save £15,000 this tax year into a Cash ISA.

For the top ISAs that are only available to people who already have products with a financial institution or live in certain geographic areas, see The hidden best buy Cash ISAs. And if you're looking to transfer old ISA savings, you want Top Cash ISAs for transfers. If you're thinking about a stocks & shares ISA for the first time, have a read of Beginner's guide to stocks & shares ISAs.

Free ISA guides

Top instant-access Cash ISAs

The top high street instant-access ISAs for this year we were able to find both come from Coventry Building Society. There's the Branch Instant ISA, which pays 2.00%. As the name suggests, you can only open one in a branch. Or if you had a Coventry ISA in February 2013, you can apply for the ISA Reward, which pays a fantastic 2.50% and can be opened with just £1.

Nationwide's Flexclusive pays 1.75%, but this is limited to people who have a Nationwide current account (such as the FlexDirect orFlex account).

If you can get to a branch easily, Cheshire Building Society and Derbyshire Building Society (both part of the Nationwide group) have the top ISA that's available to all, paying 1.60%. If you want to open yours online, you're looking at Virgin Money, NS&I, Skipton or Penrith building societies, all paying 1.50%.

Account

Interest Rate (AER)

Minimum deposit

Bonus

Notes

Coventry BS ISA Reward

2.50%

£1

None

Transfers and new subscriptions. Must have held Coventry BS ISA in February 2013.

Coventry BS Branch Instant ISA

2.00%

£1

None

New subscriptions only.

Nationwide BS Flexclusive ISA

1.75%

£1

None

New subscriptions only. Must hold Nationwide current account.

Cheshire BS Easy Saver ISA

1.60%

£1

None

New subscriptions only.

Derbyshire BS Easy Saver ISA

1.60%

£1

None

New subscriptions only.

Virgin Money Easy Access E-ISA

1.50%

£1

None

Transfers and new subscriptions.

NS&I Direct ISA

1.50%

£1

None

Transfers and new subscriptions.

Skipton BS Online Bonus Cash ISA

1.50%

£1

0.25% for first 12 months

Transfers and new subscriptions.

Halifax ISA Saver Online 1.50% £1 1.25% for first 12 months Transfers and new subscriptions.

Penrith BS ISA

1.50%

£100

None

Transfers and new subscriptions.

GE Capital Direct GE Saver Cash ISA 1.50% £500 None

Transfers and new subscriptions.

Nationwide BS Instant ISA Saver 1.50% £1,000 None

Transfers and new subscriptions.

Sometimes instant-access accounts come with temporary bonuses. We’ve got no problem with fixed bonuses. They mean that your interest rate can’t fall below a certain level for a set period. That's not the case with a variable rate bonus though.

Just remember that the interest rate on your account will almost certainly crash once the bonus expires.

Check out the current accounts that beat the best savings accounts!

Top notice Cash ISAs

At the moment giving a little warning before making a withdrawal gets you a higher interest rate with the top notice ISAs.

Account

Interest Rate (AER)

Minimum deposit

Bonus

Notes

Islamic Bank of Britain Sharia-compliant Notice Cash ISA

1.80%

£250

None

Transfers and new subscriptions.

120 days’ notice required for withdrawals.

Hinckley and Rugby BS 120-Day Notice Cash ISA

1.75%

£500

None

New subscriptions only. 120 days’ notice required for withdrawals.

Top fixed rate ISAs

Moving onto fixed rate ISAs, which lock up your money for a certain period of time.

With the Bank of England indicating that interest rates aren't likely to rise rapidly in the short term, it might be worth opting for a 18-month or two-year fixed rate in order to get a better return with the option to exit in the not too distant future.

Here are the best buys by interest rate. Note that if you've already opened a fixed rate ISA in this tax year, prior to the ISA limit being increased to £15,000, you should be able to top it up. However, some providers are only offering a small window of opportunity to do this. You can see all the deadlines in our guide to New ISA top-up deadlines 2014/15.

Account

Interest rate (AER)

Minimum deposit

Length of fixed rate

Notes

Virgin Money Fixed Rate Cash E-ISA

3.00%

£1

Five years

Transfers and new subscriptions.

Leeds BS Fixed Rate ISA

2.85%

£500

Five years (fixed until 30th June 2019)

New subscriptions only. Early withdrawals of up to 25% of savings allowed without penalty.

Julian Hodge Bank Fixed Rate Cash ISA

2.85%

£5,000

Five years

Transfers and new subscriptions.

Coventry BS Fixed Rate ISA

2.75%

£5,940

Fixed until 31st May 2018

New subscriptions only.

Clydesdale Bank Cash ISA Fixed Rate Bonds

2.45%

£2,000

Three years (fixed until 31st October 2017)

Transfers and new subscriptions.

Yorkshire Bank Cash ISA Fixed Rate Bonds

2.45%

£2,000

Three years (fixed until 31st October 2017)

Transfers and new subscriptions.

Virgin Money Fixed Rate Cash E-ISA

2.25%

£1

Three years

Transfers and new subscriptions.

Nationwide Fixed Rate ISA

2.25%

£1

Three years

Transfers and new subscriptions.

Aldermore Fixed Rate Cash ISA

2.25%

£1,000

Three years

Transfers and new subscriptions.

Virgin Money Fixed Rate Cash E-ISA

2.10%

£1

Two years

Transfers and new subscriptions.

Virgin Money Fixed Rate Cash E-ISA

1.76%

£1

One year

Transfers and new subscriptions.

The danger with locking your money away for a longer time such as five years in a fixed rate ISA is that rates may rise in just a couple of years' time.

Compare ISAs

This article is regularly updated with the latest rates

More on ISAs and savings:

Top Cash ISAs for transfers

Where to earn most interest on your cash

Beginner's guide to stocks & shares ISAs

The top fixed rate savings bonds 

Top instant access savings accounts

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