Where to find a market-beating cash Isa
Just in time for the end of the tax year, Skipton Building Society has made its top-paying easy-access cash Isa available online. It pays 1.5% including a 0.5 percentage point bonus for a year.
Post Office Premier Isa also pays 1.5% with a 0.85 point bonus for the first 18 months you are in the account. NS&I at 1.5% also offers a top rate for this year's cash Isa allowance of up to £15,000.
On fixed-rate cash Isas a new deal from Halifax pays 1.6% fixed for 18 months. The top one-year fixed rate comes from Shawbrook Bank at 1.65% followed by Virgin Money at 1.6%.
For two years Yorkshire and Clydesdale banks pay 2.1% but you must open an account in a branch. Post Office and Shawbrook Bank both pay 1.95%.
On taxable accounts Coventry Building Society's new Easy Access Saver pays 1.15% (0.92%) with no bonus or withdrawal restrictions available over the internet, the phone and through its branches.
The best internet-only deals include Skipton Limited Edition e-Saver, Charter Bank Easy Access Account, Kent Reliance Easy Access and State Bank of India Online Saver all at 1.25% (1%).
Virgin Money's Defined Access account pays a higher 1.35% (1.08%) but limits you to three withdrawals a year. You can earn a slightly better 1.4% (1.12%) with Coventry PostSave easy access if you are happy to run the account through the post and make no more than 12 withdrawals a year.
On fixed-rate deals Shawbrook Bank pays 1.85% (1.48%) for one year and 2.2% (1.76%) for two years.
Those aged 65 or more can do better with National Savings and Investments bonds that 2.8% (2.24%) for one year and a top 4% (3.2%) for three years. The maximum you can put into each bond is £10,000 and they are on sale until 15 May.
This article was written for our sister website Money Observer
There are limits to how much you can invest in any tax year. For 2011/12, the limit is £10,680. Of that, the maximum you can invest in cash is £5,340 and the balance of £5,340 can be invested in shares (individual company shares or investment funds). If you don’t take the cash ISA allowance, you can invest up to £10,680 into a stocks and shares ISA.
Invidivual Savings Accounts were introduced on 6 April 1999 to replace personal equity plans (PEPs) and tax-exempt special savings accounts (TESSAs) with one plan that covered both stockmarket and savings products, the returns from which are tax-exempt. The ISA is not in itself an investment product. Rather, it’s a tax-free “wrapper” in which you place investments and savings up to a specified annual allowance where the returns (capital growth, dividends, interest) are tax-exempt (you don’t have to declare ISAs and their contents on your tax return). However, any dividends are taxed within the investment, and that can’t be reclaimed.
This is a mutual organisation owned by its members and not by shareholders. These societies offer a range of financial services but have historically concentrated on taking deposits from savers and lending the money to borrowers as mortgages, hence the name. In the mid-1990s many societies “demutualised” and became banks. One academic study (Heffernan, 2003) found demutualised societies’ pricing on deposits and mortgages was more favourable to shareholders than to customers, with the remaining mutual building societies offering consistently better rates. In 1900, there were 2,286 building societies in the UK; in 2011, there are just 51.