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6 of the best one-year cash ISAs

6 of the best one-year cash ISAs

Category: ISAs
Author: Lieke Braadbaart
Date: 01/11/2018

Cash ISAs may not offer the most exciting returns when compared to 'normal' savings accounts, but they still offer the security that your accumulated savings will be protected from taxation no matter what. They've also seen some welcome changes recently, which means now's not the time to dismiss them out of hand.

For those who are worried that rates may increase or they might need the money in a year's time, a one-year cash ISA could be the perfect compromise. You'd still get a fixed rate of return, but you'd gain access to your pot of money again in just a year. Some accounts may even let you access the money earlier, though this will likely come with a penalty of some sort.

As with their non-ISA counterparts, savers may not be able to add funds to the account after opening either, which means you may want to think about putting your entire yearly ISA allowance in at once – £20,000 in the 2018/19 tax year. If you're choosing to transfer funds from another cash ISA instead, you'll still have your allowance to use up elsewhere, as long as you don't forget to follow the ISA transfer rules.

Whatever your reasoning, if you've decided a one-year cash ISA could be for you, have a look at the top six currently available.

AER Details
Al Rayan Bank
Al Rayan Bank
Fixed Term Deposit Cash ISA
1.61%
(anticipated profit rate)
  • Rate fixed for 12 months
  • £1,000 minimum deposit
  • Further additions permitted for 30 days from account opening
  • No withdrawals or early access allowed
  • Transfers in from cash and stocks & shares ISAs allowed within 30 days of account opening
  • Transfers out on reduced profit rate for up to 90 days
  • Account can be opened and operated through all channels (branch, post, phone, internet and mobile app)
  • Interest paid quarterly
  • Sharia'a compliant account

Out ahead in the number one spot is Al Rayan, with a market-leading expected profit rate of 1.61% AER (1.60% gross) paid quarterly over 12 months on a minimum investment of £1,000. This deal comes with the welcome flexibility of being able to add funds for some time and transfer out if you really need to, and you can even manage the account whichever way you prefer thanks to its numerous operating channels.

AER Details
Paragon Bank
Paragon Bank
1 Year Fixed Rate Cash ISA
1.55%
  • Rate fixed for one year
  • £500 minimum deposit
  • Additions permitted for 15 days from the initial deposit
  • Earlier access and transfers out allowed on 90 days' loss of interest
  • Transfers in allowed from cash and stocks & shares ISAs
  • Access requires nominated current account
  • Internet-only account
  • Interest paid on its anniversary

Paragon Bank sits in second place with an online-exclusive deal that pays 1.55% on its anniversary for those with a minimum of £500 to invest. Not only does this ISA allow additions for more than two weeks, but it even permits earlier access and transfers out, as long as you're willing to pay an interest penalty for the pleasure.

AER Details
POM
Post Office Money
Online ISA - Fixed Rate Issue 14
1.55%
  • Rate fixed for one year
  • £500 minimum deposit
  • Additions not allowed
  • Transfers in from cash, stocks & shares and Help to Buy ISAs permitted for the initial deposit only
  • Early access possible on a 90-day interest penalty and closure of the account, with the same interest penalty applying to transfers out
  • Holding account opened automatically
  • Can split ISA savings
  • Nominated account required for access
  • Internet-operated
  • Interest paid on anniversary of account opening and must be compounded

Completing the top three is Post Office Money, with its one-year ISA also paying 1.55% to those who have at least £500 to put away. While additions are not allowed, savers do have the option of gaining early access on closure of the account and an interest penalty, and they can even choose to split their ISA allowance to retain some further flexibility.

AER Details
Yorkshire Bank
Yorkshire Bank
Cash ISA - Fixed Rate Bond (Issue 47)
Go to Site
1.55%
  • Rate fixed until 29.11.2019
  • £2,000 minimum deposit
  • Further additions while the issue remains open
  • Transfers in from cash and stocks & shares ISAs allowed
  • Early access on closure of the account and a variable interest penalty, with the same variable penalty of up to 180 days' loss applying to transfers out
  • Branch- and internet-operated account
  • Interest paid on maturity and must be compounded

Yorkshire Bank is next, with this account also paying 1.55%, but from an initial investment of £2,000. Further additions are allowed until the bank decides to close the issue, while the option to retrieve your funds early (should you need to) makes this an appealing choice for anyone unsure of what they want to do with their cash.

AER Details
Clydesdale Bank
Clydesdale Bank
Cash ISA - Fixed Rate Bond (Issue 47)
Go to Site
1.55%
  • Rate fixed until 29.11.2019
  • £2,000 minimum deposit
  • Further additions welcome while the issue remains open
  • Transfers in from cash and stocks & shares ISAs allowed
  • Early access on closure of the account and a variable interest penalty, with the same variable penalty of up to 180 days' loss applying to transfers out
  • Branch- and internet-operated account
  • Interest paid on maturity and must be compounded

In fifth place is this ISA from Clydesdale Bank; yet another deal that offers a rate of 1.55%, this time on a minimum investment of £2,000 until 29 November 2019. With its features largely matching Yorkshire Bank's offer, this could be an appealing alternative for those savers who have Clydesdale branches nearby.

AER Details
Bank of Cyprus
Bank of Cyprus UK
Fixed Rate Cash ISA
Go to Site
1.54%
  • Rate fixed for one year
  • £500 minimum deposit
  • Additions of at least £100 allowed, but a variable rate will be paid on these extra funds
  • Transfers in permitted from cash and stocks & shares ISAs
  • Early access and transfers out welcome on the loss of 180 days' interest
  • Can be opened online or over the phone, and then operated by post as well
  • Interest paid on its anniversary and must be compounded

Bank of Cyprus UK completes this top six with an account that pays 1.54% on a minimum £500. Savers can add funds at will and withdraw whatever they may need on an interest penalty, giving them plenty of flexibility for what is still close to a market-leading rate.

Information and rates correct as at: 01.11.2018

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

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