Best Cash ISA Rates 2026: Where to Put £20,000 Before the Allowance Drops to £12,000

According to MoneySavingExpert, easy-access means you can withdraw without penalty — essential if you might need the money within 12 months.

Trading 212 Cash ISA — 4.68% AER (includes 1.08% bonus for 12 months). The headline leader, but that bonus drops off after year one. Underlying rate is 3.60%. Good for a one-year play if you set a calendar reminder to transfer out.

Plum Cash ISA — 4.66% AER (includes 2.12% bonus for first year). Even more bonus-dependent — the ongoing rate is just 2.54%. App-based, no minimum deposit. Fine for topping up, but don't park £20,000 here thinking you're earning 4.66% forever.

Moneybox Cash ISA — 4.26% AER (includes 0.81% bonus for 12 months). Requires £500 minimum and limits you to three withdrawals per year. That withdrawal cap makes it semi-easy-access at best — read the small print.

Hargreaves Lansdown Active Savings (Vida) — 4.26% AER with no bonus. This is the best clean rate without temporary sweeteners. HL acts as a marketplace — all partner banks are FSCS protected up to £85,000 per institution — your money sits with Vida Savings (FSCS protected separately). No minimum deposit, genuine easy access.

The chart tells the real story. Trading 212 and Plum lead on headline rate, but strip out the bonus and Hargreaves Lansdown's Vida deal is the strongest long-term option. If you want a clean rate you won't need to babysit, HL wins.

MoneyWeek's latest comparison shows strong fixed options. If you won't need the money for 1-2 years, a fixed-rate ISA guarantees your return regardless of what the Bank of England does next. With markets pricing in further rate cuts through 2026, locking in now looks smart.

1-year fixed: Top rates around 4.25% AER from challenger banks. NatWest offers 4.05% (or 4.20% on balances over £25,000), Santander pays 4.00%. The gap between best-buy and high street is narrower than on easy access — about 0.25 percentage points.

2-year fixed: Up to 4.31% AER from the best providers. NatWest pays 4.30% on £25,000+. Lloyds lags at 3.70% — nearly half a percentage point below the market leaders.

3-year fixed: Rates drop to around 4.13%. The yield curve is slightly inverted for ISAs right now — you earn less for locking up longer. That signals the market expects base rate to fall further, which means today's fixed rates are a ceiling, not a floor.

The 2-year sweet spot stands out: you lock in 4.31% through to spring 2028, by which point base rate could be 3% or lower. That's a meaningful premium over whatever easy-access rates will be paying by then.

The Moneyfacts comparison tables track rates daily. From 6 April 2027, the government is cutting the cash ISA allowance from £20,000 to £12,000 for under-65s. The overall ISA limit stays at £20,000, but only £12,000 of that can go into cash. The remaining £8,000 must go into stocks and shares or innovative finance ISAs — or not be used at all. With just 14 days until the deadline, this year's £20,000 cash allowance is the last of its kind.

Crucially, transfers from S&S ISAs back into cash ISAs will also be banned from April 2027. That's a one-way door: once money moves out of cash, it can't come back.

This makes the 2026/27 tax year — starting 6 April 2026 — the last chance to put a full £20,000 into cash ISAs. At 4.68%, that's £936 in tax-free interest. From April 2027, the same saver can only shelter £12,000 in cash, earning £562 at the same rate. That's £374 less per year, every year.

For higher-rate taxpayers who exceed their £500 Personal Savings Allowance, the tax shelter matters even more. A 40% taxpayer earning 4.68% on savings above the PSA loses £1.87 per £100 to tax. On £20,000 in a taxable account, that's £374 in tax — exactly what the ISA wrapper saves you.

Not everyone. Basic-rate taxpayers get a £1,000 Personal Savings Allowance — interest on the first £1,000 is tax-free regardless of wrapper. At 4.68%, you'd need over £21,000 in savings before the PSA runs out. If your total cash savings are under £20,000, a cash ISA adds nothing this year.

But here's where the £12,000 cap changes the calculation. Even if you don't need the ISA tax shelter today, filling your cash ISA now preserves that £20,000 of sheltered space. ISA balances roll over year to year — money deposited in 2026/27 stays sheltered forever. Once the cap drops, you can never get that extra £8,000 of annual allowance back.

The case is strongest for:

• Higher-rate taxpayers (40% or 45%) with only a £500 PSA — the ISA wrapper saves real money immediately
• Anyone with savings above £20,000 who will breach the PSA
• Long-term planners building a tax-free cash reserve over multiple years — the compounding of tax-free interest makes ISAs increasingly valuable over time
• Over-65s who keep the full £20,000 allowance post-2027 and should maximise now while rates are high

For a deeper look at ISA types and strategies, see our comprehensive ISA guide. If you're also considering stocks and shares ISAs, the tax wrapper works the same way — but your capital is at risk. Our savings hub compares all the options.

The gap between headline and ongoing rates has never been wider. Trading 212's 4.68% drops to 3.60% after 12 months. Plum's 4.66% drops to 2.54%. That's a bait-and-switch that relies on customer inertia.

If you're disciplined enough to transfer every 12 months, bonus-chasing works. Set a reminder, transfer to the next best-buy when the bonus expires, and you'll consistently earn above market. Most people won't do this — the industry knows it.

For a hands-off approach, prioritise clean rates. HL Active Savings at 4.26% with no bonus is the standout. You won't see it top the comparison tables, but you'll earn more over two years than someone who takes the 4.68% and forgets to move.

Check our guide to transferring cash ISAs — the process takes 5-15 business days and your money stays tax-free throughout.

The 2025/26 tax year ends on 5 April 2026. If you haven't used your ISA allowance, you have two weeks. The 2026/27 allowance — the last at £20,000 for cash — opens on 6 April.

Here's the playbook:

If you have unused 2025/26 allowance: Open an easy-access cash ISA today. Trading 212 at 4.68% or HL Active Savings at 4.26% (no bonus). You lose this allowance permanently on 5 April — it doesn't roll over.

On 6 April: Deposit your 2026/27 allowance immediately. Whether you choose easy-access or fixed depends on your timeline. If you won't need the money for two years, the 2-year fixed at 4.31% locks in a strong rate through a likely cutting cycle. If you want flexibility, easy-access at 4.26%+ is still excellent.

If you already have old cash ISAs at low rates: Transfer them. Previous years' ISA balances can be moved to new providers without using your annual allowance. If your existing ISA pays 2% and the market pays 4.26%, you're leaving money on the table — see our ISA transfer guide.

Don't overthink the provider choice. The difference between 4.68% and 4.26% on £20,000 is £84 per year. The difference between doing this and not doing this is £936.

This article is for informational purposes only and does not constitute financial advice. You should seek independent financial advice before making any investment decisions.