April 5th is one of the most important dates in the savers’ calendar, even if it is less exciting than Christmas. It marks the end of the tax year when canny savers either ‘use it or lose it’.
We are talking about your annual Individual Savings Account allowance which allows you to legally hide savings and investments from the tax man’s grasp. The current cash ISA allowance is £5,640 and this will increase to £5,760 in the new tax year.
The good news is that there are tax-free ISAs that can beat inflation but you need to get your skates on. Santander’s two year deal and three, four and five year ISAs from Halifax are competitive if you can tie up your money.
Both fixed and variable rates are lower than this time last year, so shopping around is important. Santander has the best variable rate at 2.50%. That might not sound a huge return, but tax payers should be interested as non-ISA returns work out far less at the moment.
Even if you don't pay tax, current cash ISA rates stand up well against other accounts. And don’t forget that adding to your account every year can lead to a tidy sum. Anyone who has saved the maximum allowed each year in an ISA since 1999 would have a total pot over £60,000 even if they had only received the Bank of England Base Rate. So what’s not to like? Not a lot!
See our best buy tables for the latest ISA deals. Then get on the phone or internet, or to your local branch, to bag your end-of-season ISA deal. It's important to sort yours before Friday, as some of the deadlines are earlier. And there could be a queue of other SavingsChampion.co.uk followers ahead of you!
Less time critical but equally important is to think about your existing ISAs. Chances are they are no longer best buys. See our article below for some transfer tips.
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