Savers are being urged not to leave it to the last minute to use this year's cash Isa allowance, as the deadline falls on Easter Sunday, 5 April. With interest rates as high as 4.45% on offer and a future cut in the allowance looming, experts predict a last-minute rush.
The Isa wrapper allows individuals to save or invest up to £20,000 per tax year free of tax. In April 2025, £14bn was paid into cash Isas, the highest monthly total since April 1999, and this year could see even more activity due to upcoming changes.
From April 2027, the cash Isa allowance for those under 65 will be reduced from £20,000 to £12,000. This has prompted wealthier savers to maximise their allowance before it is cut. Anna Bowes of The Private Office warned that some providers may withdraw their offerings early to process applications before the deadline.
Top fixed-rate cash Isas are currently paying around 4.45%, with providers such as Close Brothers Savings, Furness Building Society, and Vida Savings offering competitive rates. For variable-rate Isas, Plum offers 4.66% and Tembo Money 4.55%, both including a 12-month bonus. Most of these providers are online-only.
Rachel Springall of Moneyfactscompare.co.uk advised savers not to delay, as they risk losing the chance to use this year's allowance. She noted that challenger banks and building societies are offering the best deals, so it is worth looking beyond the big high street banks. The allowance cut, announced in last year's budget, aims to encourage younger savers to invest in the stock market, but research by Aldermore bank found that 51% of people are unaware of the changes.
