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What is ISA season and why does it matter for your savings?

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Ella Mower

Content Writer
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At a glance

  • ISA season takes place during March and April as one tax year ends and another begins
  • For existing savers, ISA season is an important reminder to use up your allowance before the end of the tax year
  • If you’re considering opening an ISA, you’ll normally find the best rates during ISA season.

Heading into spring, you may hear the phrase ‘ISA season’ being used by the financial press. But what is ISA season? And why does it matter to you?

What is an ISA?

An ISA is a type of savings account that allows you to earn tax-free interest on deposits of up to £20,000 each tax year. You can find out more about ISAs by reading our guide to understanding the different types of ISAs.

What is ISA season?

ISA season happens annually in the lead-up to the end of the current tax year on 5 April, and the start of the new tax year on 6 April. During this time, providers can usually be expected to promote their most competitive ISA rates as they try to attract savers who either haven’t opened an ISA or have yet to use their ISA allowance by the end of the tax year. They may also be looking to encourage early savers ahead of the new tax year.

Typically, the best ISA rates are available during March and at the beginning of April, but ISA season can start as early as February so it’s worth watching out for higher rates from then. After April, ISA rates normally fall, though they can sometimes peak again during the autumn in what’s known as the second ISA season. You should remember that when it comes to ISA season, there are no hard-and-fast rules. Competitive rates and their timings aren’t guaranteed, and it doesn’t prevent providers from introducing attractive rates several months after ISA season has ended, so it’s important to keep a look-out for the best ISA rates year-round.

Why ISA season matters for your savings

The ISA allowance lets you save up to £20,000 across different types of ISAs per tax year, so ISA season is a helpful reminder to use up the last of your allowance before the tax year is up. Any allowance you don’t use can’t be taken with you into the next tax year, which means you’ll have missed out on the chance to maximise the tax-free interest your savings can earn. The common phrase ‘use it or lose it’ certainly applies here.

You can also enhance your savings during ISA season by capitalising on some of the competitive rates on offer. If you have a current ISA and see a provider offering better rates, consider opening a new ISA and transferring the funds across. Be careful to check that your current ISA doesn’t impose transfer out penalties, and that your new ISA will allow transfers from existing accounts. For more information, see our guide to transferring ISAs.

If you don’t already have an ISA, ISA season may be a good time to think about opening one so you can take advantage of some of the attractive rates on offer, and so that your savings can benefit from tax-free interest. By opening an ISA at the start of the tax year, you’ll have the added bonus of having a full financial year to use up your ISA allowance.

Disclaimer: This information is intended solely to provide guidance and is not financial advice. Moneyfacts will not be liable for any loss arising from your use or reliance on this information. If you are in any doubt, Moneyfacts recommends you obtain independent financial advice.

coins in a jar with a plant sprouting out of it

At a glance

  • ISA season takes place during March and April as one tax year ends and another begins
  • For existing savers, ISA season is an important reminder to use up your allowance before the end of the tax year
  • If you’re considering opening an ISA, you’ll normally find the best rates during ISA season.

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Moneyfactscompare.co.uk will never contact you by phone to sell you any financial product. Any calls like this are not from Moneyfacts. Emails sent by Moneyfactscompare.co.uk will always be from news@moneyfacts-news.co.uk. Be ScamSmart.

Moneyfactscompare.co.uk will never contact you by phone to sell you any financial product. Any calls like this are not from Moneyfacts. Emails sent by Moneyfactscompare.co.uk will always be from news@moneyfacts-news.co.uk. Be ScamSmart.