Eligible deposits with UK institutions are protected by the FSCS up to £120,000 per person per institution.
Who owns whom?
Find out which banks and savings account providers operate under which banking license with our who owns whom guide, helping savers work out to what degree their savings are protected by the FSCS.
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Applicants must be a UK resident. Eligible UK deposits are protected up to £120,000 per person by the FSCS.
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Interest Earned
This is an estimate of how much interest you could earn in the first year (or for the term of the product if this is less than one year). It does not take into account your personal circumstances so the actual amount received may differ. The calculation is based on the gross rate; takes into consideration the interest paid frequency and includes the following assumptions:
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Who owns whom?
Find out which banks and savings account providers operate under which banking license with our who owns whom guide, helping savers work out to what degree their savings are protected by the FSCS.
Provider LinksLinks like ’Go To Providers Site’ or ‘Speak to a Broker / our Preferred Broker’ or clicking on the ‘Provider Logo’ or ‘Product Name’ connect you to providers, online savings platforms or brokers we work with, for which we may receive a commission if you click or apply.
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Cash ISAs are a type of Individual Savings Account that, like traditional savings accounts, pay interest on money deposited. Their main appeal is any interest earned is automatically tax-free (in contrast to standard savings accounts, which may require you to pay tax if you exceed your Personal Savings Allowance).
However, keep in mind that the tax benefits depend on your personal circumstances and may change in the future.
The Personal Savings Allowance (PSA) is the maximum amount of interest you can earn on your savings each tax-year before needing to pay your usual rate of income tax. This currently stands at:
| Personal Savings Allowance (tax-free interest) | Tax applied on interest earned above Personal Savings Allowance | |
|
Basic-rate taxpayers |
£1,000 |
20% |
|
Higher-rate taxpayers |
£500 |
40% |
|
Additional-rate taxpayers |
£0 |
45% |
While questions were raised about the value of cash ISAs when the Personal Savings Allowance was introduced in 2016, the tax-free savings accounts have since proven their worth for many people. Interest rates are currently much higher than 10 years ago – meaning even those with smaller balances may be at risk of exceeding their allowance. What’s more, many are seeing their allowance slashed as they are pulled up the tax-ladder by the process of fiscal drag (where wages grow, but tax bands remain frozen).
There are several types of cash ISAs to consider – each of which suit different needs, circumstances and savings goals. They include:
Easy access ISAs are perhaps the simplest type of cash ISA; like easy access savings accounts, they pay a variable rate (which can go up or down), and let savers add to and withdraw from their pot at any time. But, while many easy access ISAs allow unlimited penalty-free withdrawals, keep in mind that some apply a lower rate if you exceed a certain number of withdrawals within a given timeframe.
It should also be noted that some providers bolster the rate paid by their easy access cash ISA with a short-term bonus, so it’s important to check whether an account is still competitive once any offers expire.
Those willing to wait before accessing their cash have historically been able to find higher variable rates offered by notice cash ISAs (although this isn’t guaranteed). These accounts allow withdrawals subject to serving a notice period that can range anywhere from a week to over 180 days, while some grant earlier access subject to a loss of interest penalty.
Fixed rate cash ISAs offer an interest rate that is guaranteed to remain the same over the course of a term (which can range anywhere from less than a year to over five years). In exchange, you typically won’t be able to withdraw funds until the account matures, however, some fixed ISAs permit early access subject to a loss of interest penalty and/or account closure.
A regular savings cash ISA could be a good option for those looking to get into the habit of saving, as some of these accounts require you to make a minimum monthly deposit and may impose restrictions when it comes to withdrawals. But, bear in mind this corner of the cash ISA market is usually less competitive as there are fewer accounts to choose from.
Cash ISAs can be opened by UK residents aged 18 or over. They’re also available to crown servants (such as members of the armed forces and overseas diplomats), as well as their spouse or civil partner.
Did you know there are specially designed Junior cash ISAs which can be opened by or on behalf of children and teens under the age of 18?
While any eligible person can open a cash ISA, they may be best suited to those with a substantial enough deposit that they risk paying tax on the interest earned from their savings.
At the start of February 2026, the Moneyfacts Average Saving Rate stood at 3.31%. Based on this figure, a basic-rate taxpayer with a balance above £30,000 held in a traditional savings account might face a tax bill on their returns. This threshold is even lower for higher-rate taxpayers, at roughly £15,000. Check how much interest you might earn from your savings using our lump sum calculator.
Meanwhile, additional-rate taxpayers perhaps stand to benefit the most from a cash ISA, as they don’t receive a Personal Savings Allowance – meaning that any interest earned from a traditional savings account is liable for tax.
Cash ISAs can usually be opened online, in branch, by post, over the phone or via mobile app (depending on the particular account and provider). Before you apply, there are a few things you may need to have at hand, such as:
There’s no limit on the total number of cash ISAs you can open and pay into within a single tax-year, so long as you don’t exceed your annual ISA allowance. For example, you could use an easy access cash ISA to build an emergency fund and open a fixed rate cash ISA to save towards a longer-term goal – all within the same tax-year.
Importantly, it should be noted that Lifetime ISAs and Junior ISAs are exceptions to these rules.
Related guide: How many ISAs can I have?
The ISA allowance is the maximum amount of money you can spread across ISAs per tax-year and currently stands at £20,000.
While savers can choose to allocate their entire ISA allowance into cash ISAs, this is set to change after the Chancellor of the Exchequer, Rachel Reeves, announced the cash ISA subscription limit will be reduced to £12,000 from April 2027 for those under 65.
If you exceed your annual ISA allowance – even accidentally – it’s likely you’ll need to pay tax on the interest earned from your surplus cash. However, it’s worth contacting your ISA provider, as they may be able to remove the oversubscription and any interest earned (if it occurred in the current tax-year). Otherwise, HMRC will usually be in touch once the tax-year ends.
Remember, it’s your responsibility to stay within the ISA allowance by keeping a careful track of your contributions.
Yes, your money is safe in a cash ISA so long as the account is provided by a UK regulated bank or building society and protected under the Financial Services Compensation Scheme (FSCS). The scheme covers up to £120,000 in case a provider goes bust (although it should be noted this limit is shared by banks that operate under the same licence – view our guide to ‘who owns whom’ for more information).
Rest assured that all cash ISAs that feature on our charts are protected by the FSCS.
Whether you can withdraw money from a cash ISA (and how often) will depend on the specific type of account and provider.
Those who often dip into their savings pot may be better suited to an easy access cash ISA, as these accounts allow withdrawals at any time (although some apply a lower rate for exceeding a set number of withdrawals per year). Notice cash ISAs could also be a good option for those who don’t mind waiting before making a withdrawal.
In contrast, fixed rate cash ISAs tend to impose the most restrictions when it comes to making withdrawals. While it may be possible to gain early access to your cash in these accounts (i.e. before the term ends), this is often subject to a loss of interest penalty and/or closure.
All providers must let you to transfer your ISA out to another account. However, keep in mind that providers aren’t under the same obligation to accept transfers in, and that fees and penalties may still apply. Check whether an account accepts transfers in by selecting ‘view further details’ next to a listing on our chart.
A flexible ISA is an account that allows you to replace funds withdrawn in the same tax-year without it counting towards your annual ISA allowance.
For instance, imagine you deposited £5,000 into a flexible cash ISA at the start of the tax-year. If you withdrew £2,500 and later that tax-year added that same amount back into the account, you’d still only have used up £5,000 of your overall ISA allowance.
On the other hand, the same transactions using a “non-flexible ISA” would count towards £7,500 of your allowance (the initial £5,000, plus the £2,500 redeposited). Learn more with our guide to flexible ISAs.
Only parents and legal guardians can open a Junior Cash ISA on behalf of a child under the age of 18. This means that grandparents can only apply for a Junior Cash ISA for their grandchild if they are their legal guardian.
However, grandparents don’t have to be legal guardians in order to add to their grandchild’s Junior Cash ISA. Just keep in mind that any contributions will count towards the child’s overall £9,000 ISA allowance.
Alternatively, some children’s savings accounts can be opened by grandparents. Head to our children’s savings account chart to learn more.
Only a spouse or civil partner can inherit the money in a cash ISA without affecting its tax-free status or their own ISA allowance (and, even then, it’s important to note they won’t inherit the account itself).
Instead, they’ll temporarily receive an extra allowance (known as an Additional Permitted Subscription, or ‘APS’) equivalent to the amount of savings their spouse or partner had in ISAs which can be used to redeposit the inherited money tax-efficiently.
While you can name other beneficiaries to receive the money in your ISA (such as a child, grandchild, friend or other family member), bear in mind this will form part of your estate and may be liable for Inheritance Tax. Furthermore, your spouse will still get an extra ISA allowance (providing they live with you at time of death). Find out more about inheriting ISAs.
| Cash ISA | Traditional savings account | |
|
Minimum age restriction |
18 |
Depends on the provider |
|
Minimum deposit |
£1+ | |
|
Maximum deposit |
£20,000 per tax-year |
Depends on the provider |
|
Tax liabilities |
All interest is automatically tax-free |
Interest is only tax-free below the Personal Savings Allowance |
|
Joint availability |
Not available as a joint account |
Depends on the provider |
|
Varieties |
Easy access ISA, fixed rate ISA, notice ISA, regular savings ISA |
Easy access account, fixed rate bond, notice account, regular savings account |
Cash ISAs have many advantages, including:
Compare the top rates for specific types of cash ISAs:
Or, explore other ISAs:
If you’ve opened a fixed rate cash ISA, your provider should be in touch before the term ends to explain your options for when the account matures. This might include:
If you don’t give instructions to your provider, it will usually automatically redeposit your cash into an instant access ISA (although it’s important to check the individual terms and conditions of your fixed ISA).
It’s important to tell your cash ISA provider if you move abroad. While your account will stay open and continue to earn tax-free returns, you’ll no longer be able to make contributions.
However, you should still be able to transfer your cash ISA to another provider and can resume paying into the account upon your return (providing you’re still a UK citizen).
Yes, you can transfer an old cash ISA to a new account. However, it’s important to follow the ISA transfer process carefully – otherwise, your money could lose its tax-free status, and you might unnecessarily use up some (or all) of your ISA allowance.
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