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Top Cash ISAs 2018/19

1.5% easy access or 2.3% fixed

best cash isa
Martin Lewis
Martin Lewis
Updated Daily

Everyone who's aged 16 or over can put a new £20,000 in to a cash ISA – a savings account where you never pay tax on the interest.

The best rates pay up to 2.3% and the earlier you save, the more you'll earn. Don't worry if you've opened one in previous tax years – you can open another with whichever provider you choose. And if the rate is poor on your old ISA, you can transfer it to the new one.

Best cash ISAs 2018/19

In this guide

What is a cash ISA?

Cash ISAs are just savings accounts you NEVER pay tax on. Everyone in the UK aged 16 or over gets an ISA allowance at the start of each tax year – for the 2018/19 tax year that ends on April 5, it's £20,000.

Just like normal savings, cash ISAs come in different flavours – there's easy access (where you can withdraw money whenever you want), fixed rate (where you get a guaranteed rate, but are supposed to lock cash in for a set time) and a variety of other types.

Quick questions

  • What happens to the allowance if I haven't used it by the end of the tax year?

    Each tax year (6 April until the next 5 April), everyone aged 16 or over gets a new ISA allowance. But if you don't use it, you lose it.

    Once that year's closed, you can't put another penny in that specific ISA allowance. So if you put aside nothing in the 2016/17 year, when the maximum was £15,240, that's it – it's gone. Or if you put £2,000 in during 2016/17, the year is closed, so you can't now top it up.

    If you do deposit the cash in time, you can keep it in there, tax-free, for as long as you like. Then, as soon as the new tax year starts on 6 April, you can deposit a whole new year's allowance.

  • Can I make withdrawals?

    Providing you've picked an easy-access ISA, you can withdraw the money whenever you want, just like a normal savings account. But remember, once the money's withdrawn – unless you have a flexible ISA – it can't be returned.

    An example should help. Say you save £15,000 into a non-flexible ISA. That leaves £5,000 left to put in for the current 2018/19 tax year. Then two months later, still in the same tax year, you take out £10,000. You can still ONLY put £5,000 back in.

  • How many ISAs can you have?

    According to HM Revenue & Customs rules, you can only have one current year's cash ISA open at any time. But you can have several old ones with several different providers, or you can have a cash ISA, a stocks and shares ISA, an innovative finance ISA and a Lifetime ISA at the same time.

    So if you opened a cash ISA with Barclays two years ago, you don't need to stick with it for this year's cash ISA – you can choose whichever the top payer is.

    Loophole to open more than one per tax year: A few providers allow you to open and pay in to more than one cash ISA with them in the same tax year under these rules:

    • The ISAs must be with the same provider.

    • You must stick to the overall cash ISA limit when totting up your combined balance between them.

  • Can I split between a fixed and easy-access ISA (or regular saver ISA)?

    As we've already explained, you can put £20,000 in a cash ISA per tax year. With the bigger allowance introduced seven providers now offer a workaround. They've structured themselves so they can allow different versions of their ISA to count as one. So you can open as many of their cash ISAs as you like, as long as you don't go over the total cash ISA limit..

    The providers that allow this are...

    - Post Office

    - Nationwide

    - Aldermore

    - Kent Reliance

    - Newcastle BS

    - Ford Money*

    - M&S Bank

    - NatWest

    - OakNorth Bank

    - Charter Savings Bank

    There's no special procedure – just open the ISAs and it'll be fine.

  • Is my money safe in an ISA?

    Yes, it works the same as normal savings. So provided your money is in a UK-regulated bank or building society account, it's protected under the Financial Services Compensation Scheme. Its golden rule counts for cash ISAs too...

    The first £85,000 per person, per financial institution is guaranteed.

    While that sounds simple, the exact rules are more complex – not every bank in the UK is UK-regulated and there are complex rules involving how different banks are registered and what counts as a financial institution. For full info about the rules, see the detailed Are Your Savings Safe? guide.

    How to maximise safety

    If you've more than £85,000 of savings (including cash ISAs and others) in one bank, then, in the unlikely event it went bust, only the first £85,000 is fully guaranteed. So for total peace of mind, don't put more than this in any one institution. Spread it around instead.

    Our preferred option is to report the top rates regardless, but to let you know if there is no UK protection. Triodos Bank is an example of this (it's based in the Netherlands).

Five cash ISA need-to-knows

To help you determine if opening a cash ISA is right for you, it's worth getting your head around the following need-to-knows...

  • 1. All savings are now paid tax-free, so consider if a cash ISA is worth it for you

    On 6 April 2016 the personal savings allowance (PSA) launched, which means all savings are now automatically paid tax-free. Basic 20% rate taxpayers can earn up to £1,000 interest a year without needing to pay tax on it, higher 40% rate taxpayers £500 (top 45% taxpayers will always pay tax on savings).

    For most people that will be enough to make all their savings tax-free, and therefore the question is simply "what pays the highest rate?"

    The answer to that isn't always cash ISAs - though rates are picking up. So for most people with under around £20,000 of total savings, cash ISAs won't always be a winner as they're beaten by the top fixed savings accounts, though it's a closer battle with the top easy-access savings accounts.

    So when should you get a cash ISA?

    For top-rate taxpayers or bigger savers who've used up the PSA, there are big tax advantages of saving in a cash ISA.

    - Basic-rate taxpayers over the PSA limit. For every £100 interest you earn in normal savings you only get £80, whereas in an ISA you get the whole £100. Therefore the normal savings rate would have to be 25% higher for it to beat a cash ISA.

    - Higher-rate taxpayers over the PSA limit. For every £100 interest you earn in normal savings you only get £60, whereas in an ISA you get the whole £100. Therefore the normal savings rate would have to be 66% higher for it to beat a cash ISA.

    - Top-rate taxpayers. For every £100 interest you earn in normal savings you only get £55, whereas in an ISA you get the whole £100. Therefore the normal savings rate would have to be 82% higher for it to beat a cash ISA.

    Also it's worth remembering that while £1,000-a-year interest seems a lot now with our current pitiful interest rates, if interest rates rise then more people will need to pay tax. So saving into an ISA now could protect you from future tax.

  • 2. Cash ISAs can be flexible – letting you replace withdrawn cash

    Some cash ISAs are flexible meaning you can replace cash withdrawn from them in the same tax year without it using up your year's ISA limit.

    In practice, this means that if you had £1,000 in a flexible cash ISA you could withdraw £500 and replenish it later in the tax year without affecting your ISA limit.

    A £500 withdrawal from a non-flexible ISA would reduce your annual ISA limit even if you later deposited £500 back into the account. 

    We note in our best buys below whether or not the ISAs are flexible - for full info on the flexibility, see Flexible ISAs.

  • 3. If you're a wannabe first-time buyer, consider a Help to Buy ISA or Lifetime ISA instead

    The first-time buyers' Help to Buy ISA launched on 1 December 2015 and it means if you use the money towards buying a first home you get an extra 25% added on top, up to a maximum of £3,000.  

    Yet the rules say you can't contribute to a Help to Buy ISA and a cash ISA in the same tax year. So if you had to choose, even though you can put less in Help to Buy, the huge bonus means it's worth it. Luckily though there are a few providers who get round the 'you can't have both' rule; full info on this in our Top Help to Buy ISAs guide.
    Alternatively, the Lifetime ISA (LISA), which launched on 6 April 2017, also offers a 25% state bonus and can be used towards buying a first home or for retirement – though you can only open one if you're aged between 18 and 39.

    You can save a maximum of £4,000 a year into a LISA and use the bonus to buy property worth up to £450,000, and unlike a Help to Buy ISA can open both a LISA and a cash ISA in the same tax year. However, access your money for anything other than purchasing a first home or for retirement aged 60+ and you'll pay a 25% withdrawal penalty (after the first year of the scheme). Full info in our Lifetime ISA guide.

  • 4. Cash in an ISA stays tax-free YEAR AFTER YEAR

    Cash in an ISA stays tax-free as long as it's in there. The aim's to protect more of your money which is why we nag you about using the full ISA allowance if you can.

    If you miss a year now, you might regret it five years later. If you've big savings, you can gradually protect more and more of your cash. Those who started saving when ISAs were first introduced in 1999 could now be sitting on a good tax-free lump sum.

  • 5. Check rates on old ISAs, as many are pitiful

    Savings providers like us to think once our money's in, it's a done deal. This is wrong. Many old ISAs now pay appallingly low rates – check yours now. If the rates don't come close to the current best buys, ditch and transfer.

    You've a RIGHT TO TRANSFER to boost them. Consolidating new and old cash ISAs together into one new shiny ISA makes it much easier to transfer again in future.

    Our ISA Transfers guide has full options. Don't withdraw the cash though, as it'd no longer be in an ISA. Tell the new provider to transfer it for you instead.

Best easy-access cash ISAs

Easy-access cash ISAs mean you can take out your money when you want, without penalty. However, there are fixed rates that offer some access, so don't plump for easy access unless you know you'll need to withdraw the money within the first year.

Santander - 1.5% AER variable

Highest rate if you're a Santander 123 World or Select customer

Apply

The Santander eISA pays 1.5% AER variable, but you can only access this rate if you're a Santander 123 World or Select customer (to see if you qualify, see FAQs below).

If you aren't you'll earn 1.1% variable interest, which can be beaten. You can open the account with £500+ and make unlimited withdrawals.

Rate: 1.5%
Min deposit: £500
How to open/access: Open online by phone or in branch, manage online or by phone 
Interest paid: Annually
Withdrawals: Unlimited
Transfers allowed: Yes
Flexible: No
Savings protection: Full

  • What is a Santander 123 World or Select customer?

    You're considered a Santander 123 World customer if you've a 123 current account, 123 Lite current account, 123 Mini current account, 123 Student current account, 123 Graduate current account, 123 Postgraduate current account or a 123 credit card.

    You can join Santander Select if you've a Select current account and pay £5,000 into it each month or have £75,000 in any Santander investment, savings or current account.

APPLY

Paragon Bank - 1.45% AER variable  

Good rate, allows unlimited withdrawals and you can open it with £1

Apply

The Limited Edition Cash ISA from Paragon Bank pays 1.45% AER variable and you can open it with just £1. Plus, it allows unlimited withdrawals so you can access your cash whenever you need it.

Rate: 1.45%
Min deposit: £1
How to open/access: Online
Interest paid: Annually or monthly
Withdrawals: Unlimited
Transfers allowed: Yes
Flexible: No
Savings protection: Full

APPLY

OakNorth - 1.44% AER variable

Good rate and you can make unlimited withdrawals

Apply

The OakNorth easy-access cash ISA pays 1.44% AER variable. It offers unlimited penalty-free withdrawals but they must be a minimum of £1,000 or the balance if less than £1,000. You can open it with £1,000.

Rate: 1.44%
Min deposit: £1,000
How to open/access: Online
Interest paid: Monthly
Withdrawals: Unlimited but a minimum of £1,000 or balance if less than £1,000
Transfers allowed: Yes
Flexible: No
Savings protection: Full

APPLY

Quick question

  • My building society or bank has a better rate than accounts here. Why isn't it featured?

    MoneySavingExpert.com is a national website serving England, Scotland, Wales and Northern Ireland. So we try to feature accounts open to everyone, which means you need to be able to open them online, or by phone or post.

    Branch-based accounts are more difficult, as unless the account is offered by one of the big banks it's unlikely that everyone will be able to reach a branch. For example, Kent Reliance Building Society sometimes offers decent branch-based accounts.

    But a person in Brighton would have to travel almost 40 miles to their nearest branch to be able to open it. Similarly, someone in Carlisle couldn't access branch-based accounts offered by Ipswich Building Society as there isn't one close by.

    It is always worth looking at local building societies and banks as they can occasionally have a corking branch-based account. But, because we're a nationwide site, we just can't feature them all.

Best fixed-rate cash ISAs

Fixed-rate savings are designed to lock money away for a set period. But by law, cash ISA providers MUST allow you access to your money, whenever you want it, though most will levy heavy penalties to do so.

Top fixed-rate ISAs: (all allow early access/closure)

PROVIDER
 RATE (AER)
 TRANSFER IN ALLOWED?
 INTEREST PAID
 PENALTY TO WITHDRAW
Top one-year fixed ISAs 
Shawbrook Bank 1.77% (min £1,000) Yes Annually or monthly
 90 days' interest
Charter Savings Bank 1.75% (min £5,000) Yes Annually or monthly 150 days' interest
Top two-year fixed ISAs
Charter Savings Bank 1.95% (min £1,000) (2)
 Yes Annually or monthly
 180 days' interest
OakNorth 1.92% (min £1,000) Yes Monthly 180 days' interest
Top three-year fixed ISAs
Coventry BS 2.05% (min £1) Yes Annually 180 days' interest
Fixed term until 30 Nov 2022
Shawbrook Bank 1.96% (min £1,000) Yes Annually or monthly

 270 days' interest
Top five-year fixed ISAs
Shawbrook Bank 2.3% (min £1,000) Yes Annually or monthly 360 days' interest
United Trust Bank 2.3% (min £15,000) Yes Annually Withdrawal amount x days drawn early x 2.3% / 365

The ISA savings calculator

When using the calculator below, use the AER (annual equivalent rate) for increased accuracy. It should be listed on your statement. Obviously as most accounts' interest rates are variable, the answers will change if the rate does, so only use the calculator to get a rough indication of your likely outcome.

The calculator assumes you put money in at the beginning of each month, so if this isn't how you do it, the answers will be ever-so-slightly out. If you don't make regular deposits but put in lump sums, figure out the monthly equivalent for a rough answer. Feel free to play with the results to see how your savings are affected.

Want to complain about your savings provider?

If your savings provider has given you the incorrect interest rate, or you haven't received your interest at all, then you don't have to suffer in silence. It's always worth trying to call your provider first to see if it can help, but if not...

Resolver Info Box

This tool helps you draft your complaint and manage it too. It's totally free, and offered by a firm called Resolver, which we like so much we work with it to help people get complaints justice.

RESOLVER – FREE SAVINGS COMPLAINTS TOOL*

If the complaint isn't resolved, you can use Resolver to escalate it to the free Financial Ombudsman Service.

ISA FAQs

Here's a list of the most common queries. If you've got a question we've not answered below, in the text above or in Martin's ISA video below, suggest a question in the forum.

Moving your ISA

Using and accessing your ISA

  • Can I open a joint ISA with my partner?

    Quite simply, no – there's no such thing. ISA stands for 'Individual Savings Account' so you cannot have a joint one. You get one ISA allowance each and that's it.

  • What happens to a cash ISA if the holder has passed away?

    If you're married or in a civil partnership, if your partner dies you can inherit a one-off extra ISA allowance on top of the annual £20,000, up to the total amount they had saved in ISAs. These are known as 'additional permitted subscriptions' (APS).

    You have a few choices. You can simply keep the ISA with the same provider, move it to a different provider that accepts APS (not all do), or the ISA goes to someone else but you get the extra allowance. To claim your allowance, you'll need to give your partner's full name, address, date of birth and date of death, your marriage/civil partnership certificate and their national insurance number if you know it. Some providers may also require a copy of their death certificate.

    The allowance you'll inherit will depend on when your partner died:

    • Before 6 April 2018. You'll inherit an allowance equivalent to the total value of your partner's ISAs at the date of death.
    • On or after 6 April 2018. You'll inherit an allowance equivalent to the total value of the ISAs at the completion of their estate, when their ISAs are closed, or at the third anniversary of their death, whichever is earliest – so any growth in value will be taken into account.

    The inherited allowance is available to make use of for three years after your partner has passed away, or 180 days after the completion of their estate, whichever is later.

    Note that inheriting the allowance is not the same as inheriting the cash in the ISA – your partner could, for example, leave some or all of their ISA money to someone else. You'd still get the extra allowance but would have to fund it with your own savings.

    If you're not married or in a civil partnership you won't inherit any extra allowance.

  • Will I get any interest if I haven't had money in the account for a full year?

    Interest is calculated daily so what you're actually paid is based on how much you've had in the account when it's payable.

    If you've only had the full allowance (£20,000) in there for a month, you'll get a month's worth of interest on it. See our interest rates guide for a full explanation.

  • If I take money out of my ISA, do I then pay tax on it at my usual rate?

    The amount you take out won't be taxed but you could taxed on any interest earned once the savings are outside the wrapper if the interest takes you over your personal savings allowance.

  • Should I use my ISA allowance for cash or stocks & shares?

    This is all about whether you gain more from putting savings into an ISA or using your ISA allowance for investing.

    The gain from putting cash into an ISA is simple: you never get taxed on the interest. But with investing, whether you actually gain from putting it in an ISA depends on your circumstances.

    Are you eligible for capital gains? Stocks & shares ISAs exempt you from capital gains tax (a tax on profits which you only pay when you sell your investments). Yet for 2018/2019 you can make £11,700 a year of profits before being hit by this tax, so this protection only helps those who are selling sizeable assets within one tax year, otherwise it's irrelevant.

    Will you put money into bonds? If you're investing in bonds such as corporate bonds or gilts (Government bonds), then you get the income without it being taxed in any case. For other bonds, a stocks & shares ISA will shelter the income from tax.

    Will you get an income? If you receive dividend income, you pay no tax on the first £2,000 earned. Anything over that is taxed at 7.5% for basic, 32.5% for higher, and a whopping 38.1% for additional-rate taxpayers. Within a stocks & shares ISA you pay no tax on dividend income, regardless of your tax status. So if you earn more than your allowance, it can represent a significant saving.

    If you're a basic-rate taxpayer you'd need to do a comparison between the amount of tax you'd get charged on savings outside a cash ISA and the amount of tax on any investments held outside a stocks & shares ISA. If you're unsure you could always stick to the previous ISA situation where you could only split the between cash and investments 50/50.

    Small investors who won't use their capital gains and are putting cash in shares investments will gain more using their cash ISAs to the limit, then putting the rest in shares. Big investors, especially those putting money in bonds, should max out their stocks & shares ISAs. Read the Stocks & Shares ISA guide for more information.

Alternatives to ISAs

  • Is it even worth saving in an ISA as rates are so low?

    Yes if you want a tax-free lump sum for the future.

    But if you're thinking "I want high rates AND a tax-free savings pot", there is an answer. You could put cash into a higher-paying account – see current accounts for 3% deals on up to £5,000 or top savings to get 1.5% on £20,000 – then a week before the end of the tax-year (6 April), move the cash into an ISA.

    You get the high rate for a year, and keep it safe from the taxman going forward.

  • Should I offset my mortgage instead of putting cash into an ISA?

    What you should do depends on your personal circumstances. If your mortgage rate is higher than what you could earn in an ISA, then yes, you'd be better off offsetting.

    But if your rate is lower, or there are high penalties for repaying early if you don't have an offset mortgage, you might be better off putting savings in an ISA. Not only that, it'll give you a safety cushion should you need it in future.

  • Should non-taxpayers bother with ISAs when it makes no difference?

    If you're likely to be a tax payer and earn more than your personal savings allowance in interest some time in the future, then yes.

    If you do build up a lump sum of non-ISA cash, then go back to work, you'll have to pay 20% tax on any interest earned over £1,000 for basic-rate payers, 40% on any interest earned over £500 for higher-rate.

    With cash in an ISA, whether you return to work or remain a non-taxpayer, the money is always protected.

  • If £1,000 or £500 in interest are tax-free in savings anyway, is there any point in an ISA?

    Since April 2016, basic-rate and higher-rate tax payers have a new personal savings allowance. This allows you to earn £1,000 in interest before paying tax if you're a basic-rate taxpayer, and £500 if you pay higher-rate tax.

    But this doesn't negate all the advantages of ISAs. There are many who will still benefit from saving in an ISA even if their tax status would be the same wherever they saved.

  • Cash ISAs vs premium bonds – what's best?

    They are calculated in a completely different way. The only similarity is that they're both tax-free. Cash ISAs are simply savings accounts where you never pay tax on interest earned.

    Meanwhile, premium bonds are simply a savings account you can put money into (and take it out when you want), where the interest paid is decided by a monthly prize draw. You can win between £25 and £1 million, tax-free.

    If you owned every premium bond in existence, the amount won over a year would be equal to 1.15% of what you put in. So very roughly, for every £100 put into premium bonds on average, you'd expect a £1.15 annual return.

    Yet because of the way the prizes are allocated, the majority of people will win much less than the interest rate anyway. You can use the Premium Bond Probability Calculator to see how likely you are to win an amount equal to the interest rate.

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Top Cash ISAs 2018/19

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