The best Cash ISAs for the 2016/17 tax year


Updated on 15 February 2017 | 7 Comments

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

It’s official: we’re less than 50 days away from the new tax year.

That means you’ll need to get cracking if you want to use up your £15,240 allowance before it gets bumped up to £20,000 on 6 April.

To get the most out of your ISA, there are a couple of things you should know before we begin. The top ISAs tend to be available to people who already have products with a financial institution or live in certain geographic areas, so have a good look at what your bank and its competitors are offering to suss out what you could be eligible for. 

If you're thinking about a stocks & shares ISA for the first time, have a read of Beginner's guide to stocks & shares ISAs.

You can also put money in an Innovative Finance ISA or IFISA which launched this year to keep returns on investments made via peer-to-peer loans tax free. Lending Works recently launched the first one at an impressive 4.7%.

For those who want to stick with Cash ISAs, we've rounded up the best instant access, notice and fixed rate accounts to get you started.

Compare Cash ISAs

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

Rate

Minimum deposit

Bonus

Notes

Access

Paragon Bank Limited Edition Easy Access ISA

1.05%

£1

None

Transfers and new subscriptions.

Online

Virgin Money Defined Access E-ISA Issue 11

1.01%

£1

None

Transfers and new subscriptions.

Online

NS&I Direct ISA

1.00%

£1

None

New subscriptions only.

Online, phone

Saga ISA Saver (Issue 15)

0.95%

£1

0.90% bonus for 18 months

Transfers and new subscriptions.

Online, phone

As you can see, some 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.

Top notice Cash ISAs

Some accounts require you to give a little warning before you take money out of the account.

Account

Interest rate (AER)

Minimum deposit

Bonus

Notes

Access

Teachers Building Society Cash ISA Notice 90 (Issue 6)

1.05%

£100

None

New subscriptions only.

90 days’ notice required for withdrawals.

Post

Charity Bank Ethical 33-Day Notice Cash ISA

0.90%

£250

None

New subscriptions only.

33 days’ notice required for withdrawals.

Post

Top fixed rate ISAs

Let's move 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, so it’s worth fixing while rates are low.

Here are the best buys ordered by interest rate.

Account

Interest rate (AER)

Minimum deposit

Length of fixed rate

Notes

Access

Paragon Bank 5 Year Fixed Rate Cash ISA

1.60%

£500

Five years

Transfers and new subscriptions.

Online

Hodge Bank 4 Year Fixed ISA

1.30%

£5,000

Four years

Transfers and new subscriptions.

Post

Leeds Building Society 3 Year Fixed Rate ISA Issue 4  

1.30%

£100

Three years

Transfers and new subscriptions.

Online, branch, post

Leeds BS 2 Year Fixed Rate ISA Issue 87

1.20%

£100

Two years

Transfers and new subscriptions only

Online, branch, post

Al Rayan Bank 12 Month Fixed Term Cash ISA

1.09%*

£1,000

One year

Transfers and new subscriptions.

Online, branch, post, phone

*Expected profit rate

Rates have been coming down consistently in recent years, so there’s a strong argument for fixing for five years before rates fall much further. The only risk you run here is missing out on a potential rate rise before your fixed-rate period is up.

A word on inflation

Only one long-term ISA matches inflation at the moment, so it’s a good idea to lock it in before the new tax year begins.

For more savings options, have a look at Inflation-beaters: where to stash your cash now.

Compare Cash ISAs

This article is regularly updated with the latest rates

More on ISAs and savings:

Top Cash ISAs for transfers

The top fixed rate savings bonds 

Beginner's guide to stocks & shares ISAs

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