If you’ve opened a newspaper or read the news online recently, you’ve probably come across the term ‘Isa season’ which focuses on how you should use your Isa allowance before the end of the tax year.
But, what does it actually mean and why should you be taking advantage of it?
In a nutshell, with normal savings accounts, any interest you make is taxed. So, say for example, you deposit £10,000 in a 12-month fixed term deposit account paying 1.93% interest. At maturity, you’ll make £193 in interest, which will be taxed at up to 45%, depending on the tax bracket you belong to. With an Isa, however, you can, at the moment, save up to a maximum of £20,000 a year and any interest you make on that £20,000 will be tax free.
At OakNorth, we offer a range of savings products for individuals: fixed term deposit accounts ranging from six months to five years, easy access and notice accounts, as well as easy access and fixed rate cash Isas. Since our launch in September 2015, we have attracted over 40,000 deposit customers, enabling them to make their money go further.
Our current Isa range gives savers a choice between two types of Isa products: a personal easy access cash Isa and a 12-month fixed rate cash Isa. Both require a minimum deposit of £1,000 to open an account and a maximum balance of £250,000. However, we’re about to strengthen our offering further with the launch of a 24-month fixed rate cash Isa and a 36-month fixed rate cash Isa.
Some things to be mindful of:
- The deadline: the end of the tax year is 5th April, so if you want to take advantage of your £20,000 tax-free subscription limit, you need to open and fund your account before then.
- Compare the market: one of the best tips we can provide is to shop around for the best product for your needs — do your research online through price comparison websites, read the personal finance pages of the national newspapers and look at the best-buy tables.
- Review the reviews: it’s also worth looking into the customer experience of the provider you’re considering.
- Make sure the provider is the right fit for your needs: while rates and reviews are important, it’s also worth looking into how you can open and manage your account. How simple is the process? How long will it take you? How can you manage it going forward?
- Make sure the product is the right fit for your needs: there are several different types of Isa products available in the market: cash Isas, which we offer, stocks and shares Isas, Help to Buy Isas, Innovative Finance Isas, junior Isas and lifetime Isas. Doing your research will enable you to find the product that best fits your needs and is most aligned with your savings goals.
SIGN UP TO OUR NEWSLETTER TO RECEIVE MORE NEWS LIKE THIS STORY
Tide names new chief technology officer
Tide has recruited Guy Duncan (pictured above) to its executive team as its new chief technology officer...
OakNorth Bank lends £650,000 to Casa Italia
OakNorth Bank has provided a £650,000 loan to Liverpool-based, 160-cover independent Italian restaurant Casa Italia...
First year of home ownership can bring with it unanticipated ‘financial challenges’
Aldermore’s First-Time Buyer Index has highlighted the importance of understanding the extra costs of owning your first home...
Starling Bank releases its first TV advertising campaign
Starling Bank has launched its first TV advertising campaign called Feel Good About Money...
Metro Bank enhances business banking offering via three new partnerships
Metro Bank has enhanced its business banking offering via three new fintech and SME partnerships...
An interview with Jacqueline Morcombe: Building diverse teams leads to ‘more innovative ideas and better business outcomes’
Jacqueline Morcombe, area vice-president of international sales enablement at nCino, discusses diversity in the banking industry, how to efficiently process commercial loans and transparency in the sector...
Paragon launches BTL intermediary portal
Paragon has announced that it has launched a new intermediary portal...
Creative England and Triodos Bank launch £24m fund for creative SMEs
Creative England and Triodos Bank UK have launched a £24m fund to provide finance to creative UK businesses...
The Nottingham boosts lifetime Isa rate for first-time buyers and retirement savers
Nottingham Building Society has increased its lifetime Isa rate from 1% AER/tax free (variable) to 1.25%, which represents a boost for first-time buyers and those saving for retirement...
A guide to how sharia-compliant mortgages work
In December 2018, we launched an alternative to traditional home loans, a home purchasing plan (HPP) for buyers in the UK, abroad and expats...
PMS and Sesame welcome Axis Bank UK to specialist lender panels
PMS Mortgage Club and Sesame Network, part of Sesame Bankhall Group, have added Axis Bank UK to their specialist lending panels...