Best Cash ISAs for the 2019/20 tax year


Updated on 23 March 2020 | 1 Comment

In this tax year, you can set aside another £20,000 of savings tax-free regardless of your tax bracket. Here are the best homes for your cash.

Should you get a Cash ISA or a savings account?

ISAs remain a good way to reduce your tax payments and interest rates have improved, particularly on easy access ISAs.

As you can only set up one new Cash ISA a year, it's important to pick the best one for your situation. 

Are Cash ISAs still worthwhile?

This year's ISA subscription limit is sitting at £20,000. It can be invested in a Cash, Stocks and Shares, Lifetime ISA and/or an Innovative Finance ISA.

Some might think there’s no point in saving into a Cash ISA anymore.

The Personal Savings Allowance (PSA) means you can earn up to £1,000 tax-free interest from any savings or current account, effectively negating the ISA's unique selling point.

You could potentially use standard savings accounts with much better interest rates.

But the humble Cash ISA still holds two attractive features for long-term savers.

It doesn't count towards your PSA and it's open to all savers.

Unfortunately, the PSA is not an option for additional-rate taxpayers and is capped at £500 for higher-rate taxpayers.

Of course, you could potentially earn a far better return and keep the tax-free benefits by investing in a Stocks and Shares ISA instead.

Yet not everyone is happy taking on the risk of investing in the stock market, while others might prefer a combination of the two.

Compare savings accounts, ISAs, and peer-to-peer investments (capital at risk)

Top instant-access Cash ISAs

These are the top rates on offer if you want to easily get your hands on your cash at any time.

ISA

Interest rate (AER)

Minimum deposit

Bonus

Notes

Access

Al Rayan Bank Instant Access ISA

1.36% (expected profit)

£50

None

Accepts transfers from Cash ISAs

Online, branch, telephone

Virgin Money Double Take ISA*

1.31%

£1

None

Accepts transfers from Cash and Stocks and Share ISAs

Online

Bath BS Instant Access

1.25%

£1

None

Accepts transfers from Cash ISAs

Branch or post

Coventry BS Easy Access ISA

1.25%

£1

Nine

Accepts transfers from Cash, Lifetime, Stocks and Share and Help to Buy ISAs

Online

*Two withdrawals permitted per year

Top notice Cash ISAs

Some accounts require you to give a little warning before you take money.

ISA

Interest rate (AER)

Minimum deposit

Bonus

Notes

Access

Teachers BS Education ISA

1.40%

£100

None

90 day notice required for withdrawals. 

 

Accepts transfers from Cash and Stocks and Share ISAs.

Online, post

Paragon Bank 120 Day Notice Cash ISA

1.31%

£500

None

120 day notice required for withdrawals.

 

Accepts transfers from Cash and Stocks and Share ISAs.

Online

 

Top fixed rate ISAs

Let's move onto fixed rate Cash ISAs, where you put your money away for a certain period of time.

Here are the best buys for each time period.

ISA

Interest rate (AER)

Minimum deposit

Length of fixed rate

Notes

Access

Paragon Bank Five Year Fixed Rate ISA

1.6%

£500

Five years

Accepts transfers from Cash and Stocks and Share ISAs.

Online, post

Cambridge BS Fixed Rate ISA

1.55%

£500

Five years

Accepts transfers from Cash, Lifetime, Stocks and Share and Help to Buy ISAs

Online, branch, telephone, post

Hodge Bank Fixed Rate Cash ISA

1.55%

£1,000

Four years

Accepts transfers from Cash and Stocks and Share ISAs.

Email, telephone

Marsden BS Fixed Rate ISA

1.55%

£5,000

Three years

Accepts transfers from Cash ISAs

Branch

Al Rayan Bank Fixed Term Deposit Cash ISA

1.50% (expected profit)

£1,000

Two years

Accepts transfers from Cash and Stocks and Share ISAs.

Online, branch, telephone, post

Virgin Money One Year Fixed Rate Cash E-ISA

1.36%

£1

One year

Accepts transfers from Cash and Stocks and Share ISAs.

Online

 

The longer you lock your money away, the better your rate will be.

The only risk you run is missing out on a potential interest rate rise before your fixed rate period is up.

ISA options

You can save some or all of your annual ISA allowance in a Cash ISA and earn interest tax-free.

But you also have the option of putting some or all of your allowance into a Stocks and  Shares ISA.

If you're new to this, you can read the Beginner's guide to Stocks & Shares ISAs for more information.

You can also put money in an Innovative Finance ISA (IFISA), which lets you keep returns on investments made via peer-to-peer loans tax-free.

There are also other options, if, for example, you want to save for your child's future or want to set money aside for retirement.

Take a look at The ultimate guide to ISAs for more information.

Compare savings accounts, ISAs, and peer-to-peer investments (capital at risk)

This article is regularly updated with the latest rate

 

  

More on ISAs and savings:

Top Cash ISAs for transfers

5 Lifetime ISA flaws – and how to fix them

Beginner's guide to stocks & shares ISAs

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