ISAs in a nutshell

Tax-free saving – what are ISAs?

ISA stands for Individual Savings Account.

With a standard savings account you pay tax on the interest you earn. With ISAs you don’t. You keep all the interest. Every penny.

Are there different types of ISAs?

Yes. There are five main types of ISAs:

  • Cash
  • Junior cash
  • Stocks and shares
  • Innovative Finance
  • Lifetime

Who can open one?

You have to:

  • be 16 or older (18 for stocks and shares ISAs)
  • be a UK resident
  • have a National Insurance number

How much can I put into an ISA?

There’s a limit on how much you can put into ISAs during each tax year. This is called the annual ISA allowance. The tax year runs from 6 April to 5 April and for 2020/21 you can put in up to £20,000.

Which ISAs do TSB offer?

We provide the simplest types – cash ISAs and junior cash ISAs. You can see them here.

Can I have more than one ISA?

Yes. You can have up to two cash ISAs. If you’ve already opened an ISA this year you can transfer it over to us.

Can I carry over my ISA allowance to the next tax year?

No. If you don’t use your annual ISA allowance within any given tax year you can’t carry it over. However, a new allowance kicks in at the start of every tax year. The tax year always ends on 5 April, so you have until then to make the most of your allowance.

If you already have an existing TSB Cash ISA, you can top it up in one of three ways:

How do I top up an existing TSB Cash ISA?

  • Internet Banking - select the account you want to make the payment from and then select "Make a transfer"
  • Mobile app – tap “Move money” and then follow the steps
  • Telephone Banking (automated service) - when prompted, say or select “transfer money”. View our guide to Telephone Banking

Some customers may be prevented initially from adding money to their existing cash ISAs from 6 April. This is due to the Government’s requirement to request that customers agree a new ISA declaration if they did not add money to their cash ISA in the previous tax year. It’s easy to reactivate your cash ISA. Simply log in to Internet Banking, select the cash ISA you want to add money into, click reactivate and follow the online instructions.

How can I close my TSB Cash ISA?

Visit our how to close your account page.

 

TSB guide to ISAs Infographic

 

Cash ISAs

What are cash ISAs?

Cash ISAs are the simplest and most popular ISA. They’re not that different from other savings accounts, except you don’t pay tax on any interest. And like other savings accounts there are a few to choose from.

If you’re happy to put your money away for a bit of time, fixed term ISAs tend to give you better interest rates. If you decide to take your money out early, you may have to pay a withdrawal charge.

If you prefer having the freedom to withdraw your money whenever you want, instant access ISAs might be right for you.

Does TSB offer cash ISAs?

Yes. In fact, we’ve got a few for you to choose from.

Fixed Rate Cash ISAs

We have three fixed rate ISAs. The longer you fix for the better the rate.

  • 18 month 0.34% Tax Free Monthly/ 0.35% AER (fixed)
  • 2 Year 0.40% Tax-free/AER (fixed)
  • 3 Year 0.55% Tax-free/AER (fixed)

All of these ISAs come with a competitive interest rate. Just remember, you’ll need to pay in at least £3,000 within 30 days of opening one of these ISAs. Find out more.  Interest paid on anniversary of account opening. Withdrawal charges apply.

Cash ISA Saver

Our Cash ISA Saver offers instant access and is great if you want to get at your money whenever you want it.

Interest is calculated daily and paid once a year on the 31st March. No withdrawal charges apply.

Save Well Limited Access ISA

Our Save Well Limited Access ISA offers instant access and gives you a higher rate of interest if you don’t make any withdrawals. You get 0.29% Tax free monthly/ 0.30% AER interest rate if you don’t make any withdrawals. If you do make a withdrawal the interest rate applied to the balance for the whole calendar month in which your withdrawal is made, will be a lower rate of 0.00% Tax free/AER (variable). Find out more.

Interest is calculated daily and is paid monthly on the 1st of each month. If you have selected to pay interest to a different account, interest will be paid on the first working day of the month.

Junior Cash ISA

A parent or guardian can open a Junior Cash ISA for a child. The child can take control of their ISA at 16, but they can’t take money out until they’re 18. So, it’s a great way to get your kids on the savings ladder. Just bear in mind the junior ISA limit is lower than the adult one – for the 2020/21 tax year it’s £9,000.

Our Junior Cash ISA pays a variable rate of 3.25% AER, tax-free and you can start one with as little as £1.

Interest is calculated daily and paid once a year on the 31st March. No withdrawal charges apply.

 

Other types of ISAs

What’s are stocks and shares ISAs?

As the name suggests, stocks and shares ISAs are invested into the stock markets. It’s usually managed by a fund management group, so there’s often a management fee. The returns can be good, but because you’re investing in the stock markets there’s more risk and they’ll tend to be longer term than cash ISAs.

What are Innovative Finance ISAs?

Innovative Finance ISAs lend to private borrowers or take a stake in a crowdfunded investment. The returns can be high, but as with all investments, they can be risky.

What are Lifetime ISAs?

These are aimed at savers under 40, the government will boost your savings by 25%. So, if you pay in the yearly maximum of £4,000, you’ll get a £1,000 bonus each year. You can use a Lifetime ISA to buy your first home or keep the money until you’re 60.

 

Moving your existing ISAs

Can I move a cash ISA?

Yes. You can even transfer a stocks and shares ISA to a cash ISA. But don’t close the ISA account you already have straight away.

Get in touch with us so we can arrange the transfer. That way you won’t lose out on any tax-free interest. It can take up to 15 days to transfer, but we aim to do it in just seven.

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Step 1

Fill in our transfer form.

Transferring most ISAs only takes a few minutes.

Why not do it now?

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Step 2

We’ll talk to your provider.

We’ll get your provider to transfer your ISA over to us.

Just check to see if they have any charges or a notice period.

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Step 3

Wait 15 days.

You can transfer cash ISAs in 15 days. Or less.

Stocks and shares ISAs might take a little longer. Up to 30 days.

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Step 4

Earn tax-free interest.

Get interest at the new rate from the day we get your completed transfer form. As long as your funds are free to move.

 

Is there anything else we can help with?

We’ve told you about all the ISAs out there – even the ones we don’t do so that you can choose the right one for you.

Find out more about our ISAs. Or speak to one of our Partners in branch. We’re always happy to help.

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