UK savers have been recommended a number of savings accounts that offer the best rates, and will help you save more before the new Government rules come into effect.
Cash ISAs have become increasingly popular over the years, mainly because they allow you to save thousands of pounds without being taxed on it. At the moment, you can save up to £20,000 a year tax-free in a Cash ISA account. However, that limit will soon be cut to £12,000.
From April 2027, the Government will reduce the total allowance that millions of UK savers can keep in a Cash ISA account.
Under-65s will have their limit reduced to £12,000 a year, meaning savers have only one year to make the most out of using the full £20,000 allowance. It is the first ISA cut since 2017, as the Government aims to encourage more people to invest in stocks and shares ISAs, where any profits made from investments are exempt from UK Income Tax and Capital Gains Tax.
That being said, the upcoming change will likely prompt banks to offer customers better deals, according to personal finance expert Katie Steere, who says that "the competition to attract new ISA year customers is going strong" and advises savers to consider opening a cash ISA "sooner or later".
Ms Steere, who works at comparison site Finder, offered some of the best accounts people should consider if they want to take advantage of the allowance before the changes.
For those wanting to start with a larger amount, the Plus Cash ISA is offering 4.60% AER, meaning savers will earn £23 in interest after a year. You can withdraw the money whenever you like, and it should be paid within one working day, according to the bank.
Other options include the XTB Flexible Cash ISA, which offers savers a 6% interest rate for the first 90 days, after which it drops to 4%.
For those wanting to put away a set amount every month, Trading 212 is offering a nice promo rate of 4.58%. If you were to put £50 away each month, your account would grow to £614.89.
