ISA guides tagged “Cash ISA”

NS&I says Premium Bonds do not earn interest and that an annual prize fund rate funds a monthly prize draw. gov.uk says you do not pay tax on interest on cash in an ISA. This guide sets out what each source says, with sources.

Interest on a Cash ISA balance is the balance multiplied by the rate, adjusted for how often the provider adds interest. This guide works through examples at assumed rates of 2%, 3% and 4%, which are not forecasts.

A flexible ISA is one whose terms let you take cash out and put it back in the same tax year without using up more of that year's allowance. Whether an ISA is flexible is set by the provider's terms, so it is worth asking.

gov.uk says you do not pay tax on interest on cash in an ISA. Interest in a normal savings account can be taxed once it goes beyond your tax-free allowances. Here is how the two compare, with a worked example.

HMRC's newsletter says the annual limits stay put until April 2031. A lower cash ISA limit from April 2027 is made in law but not yet in force, and a First Time Buyer ISA is only a proposal.

How Cash ISAs and Stocks and Shares ISAs differ on risk, access, protection and the new cash ISA limit, with the points people weigh up.