Savers have just five days left to use up this year’s ISA allowance and benefit from the tax incentives the product offers.
Individuals have until midnight on April 5 to deposit up to £5,760 in a cash ISA – or £11,520 in a stocks and shares ISA. Those who are willing to lock their money away for longer periods of time have access to higher returns but people should also consider the ethics and sustainability of the products they use.
According to MoneySuperMarket, the top fixed rate ISA currently on offer is from Skipton Building Society at 3%, while the top easy access ISA stands at 2.25% with Harpenden Building Society, although this rate is only available to members of Harpenden.
Kevin Mountford, head of banking at MoneySuperMarket, urged consumers to take advantage of he tax wrapper and warned they would be “throwing money to the tax man” if they didn’t make the most of it.
During this year’s budget, the chancellor George Osborne announced measures to improve the flexibility of ISAs. Cash and stocks ISAs will be merged to create a New ISA (NISA) with the individual limit increasing to £15,000.
A poll from the comparison site found that 29% of respondents intend to use the full allowance on offer when it increases. An extra 10% said the New ISA would help, but they wouldn’t use the full amount.
Mountford said, “Anything that encourages people to save, and which helps boost savings, especially in the current climate of low rates, can only be a good thing, and will be welcomed by many.
“Having said that, many savers won’t have the benefit of being able to save £15,000 a year, but they will benefit from the increased attention from the banking sector on ISAs, so we could see the introduction of new deals which benefit all savers.”