If you’re looking to open a savings account then I’m sure you will have heard of a Cash ISA. But what is an ISA – and how does it work?
ISA stands for Individual Savings Account – sometimes you’ll also see it called a New ISA or NISA. When saving in an ISA, the interest you earn is tax-free, which is what makes it different to other savings accounts. These funds remain tax free even if you have exceeded your Personal Savings Allowance. The amount you are allowed to invest into an ISA each tax year is set by the government – for the 2018/19 tax year, this is £20,000. There are different rules for children’s ISAs. If you do not use your limit within the tax year, you cannot carry it over – you’ll lose it and your ISA limit will reset at the start of the financial year.
Some ISAs come with a fixed rate of interest, while others are variable, and all have varying levels of access, so there may well be an ISA out there to suit your needs! At Ipswich Building Society we have a wide range of Cash ISAs, and we’ll accept transfers-in of ISAs from other providers on some of our products.
If you want to save more than the annual ISA allowance, then you may wish to consider another type of savings account – Remember, you’ll pay tax on any interest accrued over your Personal Savings Allowance.
To look at our current range visit our savings products page, or call into one of our nine branches across Suffolk and speak to a Member Assistant who may be able to help.