What is a cash ISA
A cash ISA is a tax free wrapper that allows a person to save £3000 a year with all interest being paid tax free. Also known as a Mini ISA it is not an investment in the stock market instead it’s a tax free savings account. The money invested can be withdrawn at any time but £3000 is the maximum amount of money that can be deposited into the account in a single tax year which begins in April. You may invest up to £3,000 but any money withdrawn is already accounted for withing the limit and cannot be replaced.
To be eligible to open an ISA you must be a UK resident over the age of 18.
Banks compete for customers by offering competitive interest rates for ISA. To view the best buy ISA table visit: http://www.moneysupermarket.com/isa/BestBuysResults.asp
You are only entitled to one ISA a year. Each year you can open an ISA with a bank of your choice. It is simple to move ISA’s from one bank to another so I recommend moving last years ISA to the bank you have chosen for the current year.
