Best Easy Access Cash ISAs

Easy access cash ISAs explained

What is an easy access cash ISA?

Also known as an ‘instant access ISA’ or ‘no-notice ISA’, an easy access cash ISA is a type of tax-free savings account that lets you add to and withdraw from your pot at any time.

How does an easy access cash ISA work?

Easy access cash ISAs work in much the same way as easy access savings accounts; once open, you can deposit and remove money as and when needed, and will receive interest on your balance at regular intervals.

While easy access cash ISAs are among the least restrictive savings accounts on the market, be sure to read a provider’s terms and conditions carefully. Some accounts may impose a limit on the number of penalty-free withdrawals you can make within a given period; although further withdrawals are usually permitted, this often results in the interest rate being reduced.

What are the benefits of using an easy access cash ISA? Are there any tax benefits?

The main difference to an easy access savings account is interest earned with an easy access cash ISA (or indeed any ISA) is automatically tax-exempt. In contrast, basic-rate taxpayers using a traditional savings account will be taxed on returns in excess of £1,000 each tax year, while higher-rate taxpayers have a lower threshold of £500, as per the Personal Savings Allowance (PSA). The tax benefits of ISAs depend on your personal circumstances and may change in the future.

What are the interest rates for easy access cash ISAs?

Easy access cash ISAs offer variable rates, which means the amount of interest you earn can change at short notice.

A bank or building society may amend the rate paid by their easy access cash ISA in response to a change to the Bank of England base rate, to entice new customers and/or to increase brand awareness. Good practice is to regularly review your easy access cash ISA and, if your provider adjusts the rate, to consider switching if more competitive options are available.

Related guides: UK base rate explained – and how to respond to changes

Are there any promotional rates for easy access ISAs?

As with other savings accounts, a provider may choose to apply an introductory bonus to its easy access cash ISA which can bolster its headline rate and make it more appealing to consumers. However, once the bonus expires, it’s important to check whether you’re still receiving decent returns on your money and consider moving to a different account if not.

How do easy access cash ISAs compare to other types of ISAs?

Easy access ISAs are just one of several types of cash ISAs on the market, which each offer their own features. Depending on your circumstances and savings goals, you may want to consider some of these other types of cash ISAs:

Easy access vs notice cash ISAs

Easy access and notice cash ISAs are perhaps the most similar in that both types of account pay variable interest rates and offer means of withdrawing funds without penalty.

However, these accounts differ in that you don’t have to provide notice before making a penalty-free withdrawal from an easy access cash ISA, while this is a stipulation of notice ISAs – as the product name implies.

Typically, notice ISAs would offer better returns in exchange for needing to serve notice before accessing your cash but recent volatility in the savings market means this isn’t always the case.

Easy access vs fixed rate cash ISAs

For an interest rate that is guaranteed not to change over the course of a term, you could instead opt for a fixed ISA.

Easy access and fixed rate cash ISAs both come with their own sets of advantages and disadvantages; the right account for you will depend on your needs, circumstances and savings goals: 

_{*Recent economic volatility has resulted in the gap between fixed and variable rates narrowing. Some fixed accounts are currently offering lower rates than their easy access and notice counterparts due to uncertainty surrounding the future direction of the savings market.}

There are a number of factors to consider when deciding between an easy access and fixed rate cash ISA, including the level of access you need to your cash, your savings goals and the wider economic outlook.

If you know you’ll regularly need to dip into your savings, for instance, an easy access cash ISA will often provide the greatest level of access to your funds. But, if you’re saving towards a longer-term financial goal, a fixed rate cash ISA may better help you achieve your target.

Otherwise, if you think interest rates will increase in the future, you may choose to bide your time with an easy access cash ISA. Conversely, if you think interest rates are likely to fall, you may want to lock in a competitive rate with a fixed rate cash ISA.

Easy access vs regular savings cash ISAs

Meanwhile, if you’re looking to kickstart a savings habit, you could explore regular savings ISAs. In contrast to the flexibility of easy access cash ISAs, these accounts impose a strict set of criteria you must follow, such as how much and often you can add to your pot.

Easy access cash ISAs vs Lifetime ISAs

Although easy access cash ISAs can be used to save for a house deposit, if you’re a first-time buyer between the ages of 18 and 39, a built-for-purpose Lifetime ISA (LISA) may better suit your needs. Contributions of up to £4,000 per tax-year into this type of ISA earn a 25% Government bonus, meaning you’d receive an additional £1,000 each year you pay in the maximum amount.

How do I open an easy access cash ISA?

An easy access cash ISA can be opened by applying directly with a provider. Some providers will allow you to apply online or by mobile app, while others will operate using more traditional means, such as in branch, over the phone or by post. Our charts provide further detail on the methods by which you can open and manage an account.

This process will often involve filling out documents with your personal details. Most accounts will require you to have a minimum deposit, while some providers may also ask you for your National Insurance number, photo ID and proof of address.

What are the eligibility requirements for opening an easy access ISA?

Only UK residents aged 18 or over can open an easy access cash ISA (although a temporary measure is in place whereby those born between 6 April 2006 and 5 April 2008 can open one cash ISA before turning 18). As an alternative, parents and guardians can open a Junior ISA (JISA) on behalf of a child under the age of 16, while those aged 16 or 17 can apply for an account themselves. 

Crown servants, members of the Armed Forces, overseas diplomats and civil servants are also eligible to open an easy access cash ISA, along with their spouse or civil partner.

Can I open an easy access cash ISA online?

Many easy access cash ISAs can be opened online within a matter of minutes; to streamline the process, it helps to have important documents close to hand.

You can find out whether an easy access ISA can be opened and managed online by consulting our charts. Where our ‘Easy to Open’ logo is displayed next to a listing, this means the account can be opened with minimal fuss.

Is there a limit on the number of ISAs you can open with different providers?

It used to be the case you could only subscribe to one of each of the four main types of ISA within a single tax-year, however, this restriction was removed as of April 2024. This means there’s currently no limit on the number of easy access cash ISAs you can open with different providers.

An exception to be aware of is Lifetime ISAs; you can only pay into one LISA per tax-year. Banks and building societies may also have their own rules in place, so it’s best to check a provider’s terms and conditions before applying.

Related guide: How many ISAs can I have?

Can I transfer my existing ISA into an easy access cash ISA?

Whether you can transfer an existing ISA to an easy access cash ISA depends on the type of account and provider. While all providers must allow ISAs to be transferred out, they are under no obligation to accept transfers in. It may be the case that some banks and building societies will accept transfers from certain types of ISAs but not others.

You can check what accounts a particular easy access ISA accepts transfers from by selecting ‘view further details’ next to a listing on our chart. Or, for more information on the process itself, read our guide on how to transfer an ISA.

What is the minimum and maximum amount I can deposit into an easy access ISA?

The minimum amount you can deposit into an easy access ISA will vary from one provider to another; some accounts require a more substantial initial investment, while others can be opened with no minimum deposit at all. More information on a specific account’s opening criteria can also be found by viewing further details on our chart.

As for the maximum amount you can deposit into an easy access ISA, this is subject to the annual ISA allowance. Each tax-year, you can pay in a total of up to £20,000 across all ISAs. You could choose to allocate this entire amount to an easy access cash ISA or spread it across a combination of different accounts.

Are there any limits on how much I can withdraw from an easy access cash ISA?

Generally speaking, there are no limits on how much you can withdraw from an easy access cash ISA so long as you have the necessary balance in your account. As previously mentioned, there may be a maximum number of penalty-free withdrawals you can make within a given period depending on the provider; what’s more, some may specify a minimum amount that must be withdrawn at any time.

Keep in mind, if you withdraw funds to a traditional savings account or an interest-earning current account, any returns your money goes on to accumulate will once again count towards your PSA and may be taxed.

What happens if I exceed the annual ISA contribution limit?

While it’s your responsibility to monitor how much you’re paying into ISAs each tax-year, accidents can happen. If you exceed the annual ISA allowance, HMRC will eventually be in contact, and you’ll need to pay tax on any interest received from contributions over the £20,000 threshold.

After noticing your mistake, it may be wise to contact HMRC to see if there’s any way of rectifying the situation.

Is my money safe in an easy access cash ISA and what happens if the bank or provider goes under?

The Financial Services Compensation Scheme (FSCS) protects balances up to £85,000 in an easy access cash ISA should your provider go bust. However, it’s important to note this amount applies to all funds held under the same banking licence, rather than per account or provider.

For example, this means if you had £50,000 in accounts with HSBC and a further £40,000 held with first direct, this would leave £5,000 of your hard-earned cash unprotected. For more information on providers that share a banking licence, view our guide to who owns whom.

All savings accounts featured on our charts are covered by a depositor protection scheme, as demonstrated by the ‘FSCS protected’ badge displayed next to a listing. You can also check whether your savings are protected via the FSCS website.

Can I lose money in a cash ISA?

In contrast to other savings products, such as stocks and shares ISAs, easy access cash ISAs are largely low-risk.

Nevertheless, while you can’t lose money with a cash ISA, you’ll want to make sure you’re maximising your savings by constantly reviewing top rates and considering switching if your account no longer offers competitive returns.

Are cash ISAs good for pensioners?

Cash ISAs may be a good choice for anyone concerned about being taxed on the interest earned from savings – including pensioners.

Unlike pension pots (which comprise investments that could possibly lose value), cash ISAs carry very little risk of losing money. What’s more, there are fewer restrictions when it comes to accessing the cash in your account – particularly with an easy access ISA. In contrast, most pensions can’t be claimed until you reach the Normal Minimum Pension Age (NMPA – currently set at 55, this will rise to 57 from 2028).

That being said, continuing to pay into a pension also has its advantages, as you can claim tax-relief on your contributions. If a basic-rate taxpayer were to add £100 to their pension pot, for instance, their provider could claim 20% tax-relief from the Government and boost the overall contribution to £125.

Related guide: Should I invest in an ISA or my pension?

What are the best cash ISA rates for the over-60s?

If you’re over 60, the best returns on a cash ISA will be the same as those available to everyone else; you can review the latest top easy access ISA rates using our charts.

The only exclusions are rates offered by Lifetime ISAs, as these accounts can only be opened by those under the age of 40.

What happens to my easy access ISA upon my death in terms of tax?

If you were to pass away, only a spouse or civil partner could inherit your ISA without it affecting their yearly ISA allowance or the tax-free status of the cash in the account. This is known as an Additional Permitted Subscription (APS).

While it’s possible to nominate another beneficiary to receive the money in your account, this would form part of your estate and may be subject to Inheritance Tax. Even under these circumstances, your spouse or civil partner would be entitled to an increased allowance (equivalent to the value of your assets held in ISAs) for the remainder of the tax-year.

Related guide: The rules on inheriting ISAs