Competition in the Isa market is intensifying as Skipton Building Society introduces a new fixed-rate cash Isa offering a 4.55% annual equivalent rate (AER), which a savings expert has described as market leading.
Details of the New Isa
The 18-month fixed-rate cash Isa from Skipton Building Society is accessible to both new and existing customers. It can be opened online, via the Skipton app, in branch, or by telephone. The account requires a minimum balance of £500 and allows deposits up to a maximum of £1 million.
Savers can deposit up to their annual Isa allowance of £20,000 and transfer in Isa savings from previous tax years. However, withdrawals are not permitted during the 18-month term, and early closure incurs a penalty equivalent to 90 days' interest.
Expert Commentary
Alex Sitaras, head of savings and partnership products at Skipton Building Society, commented: “With Isa allowances under increased scrutiny and savers keen to act before any future changes, many people are looking for straightforward ways to secure strong, tax-free returns. That’s why we’re pleased to introduce a new 18-month fixed Isa, offering one of the leading rates on the market today and available to both new and existing customers.”
Rachel Springall, a finance expert at Moneyfactscompare.co.uk, noted that Skipton’s deal is market leading for a short-term Isa of this type. She added: “Building societies work incredibly hard to provide decent savings rates to their members, so it’s fantastic to see Skipton Building Society offer a market-leading fixed-rate Isa, paying 4.55% after 18 months.”
Upcoming Isa Allowance Changes
From April 6, 2027, changes to Isa rules will take effect. While the total annual Isa allowance will remain £20,000, adults under 65 will only be able to deposit up to £12,000 in a cash Isa, with the remaining £8,000 allocated to stocks and shares. Savers aged 65 and over will retain the full £20,000 subscription limit for a cash Isa.
Springall emphasised that cash Isas are highly sought after due to their tax-free wrapper, making competitive rates like Skipton’s particularly attractive to savers looking to maximise their returns.
