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ISA Guide
Last-minute ISA guide
By Hazel Cottrellhazel.cottrell@consumerchoices.co.uk
Haven’t sorted your ISA yet? You need to act fast! Our guide to applying at the last minute is here to help… (03/3/10)
ISAs are a fantastic way to shield your hard earned cash from the taxman, as any interest you receive on money in an ISA comes to you completely tax free!
You can save up to £3,600 in a cash ISA each year, or £5,100 a year for the over 50s, and you really should make the most of this allowance if you can – any unused allowance is lost and doesn’t roll over to the next year.
Download our complete guide to ISAs
If you haven’t sorted your ISA yet then you need to do it now - the deadline for ISA deposits is Monday 5 April, a date which is approaching fast! This year the end of the tax year falls on Easter Monday, so organising your ISA at the last moment could leave you in trouble.
If you have already got a great ISA then you just need to make sure that you’ve put as much in as you can before this date, but if you haven’t yet got an ISA or want to switch to a better ISA then you need to act fast.
How do I get an ISA?
To get an ISA you need to do the following:
- Compare ISA deals – Take a look at what is currently available. Many banks and building societies have recently launched new ISA products to attract last minute ISA savers.
- Look for the best rate – As with all savings products, the higher the interest rate the better, so look for the juiciest offering.
- Read the small print – Before you apply for your chosen ISA, make sure you have read the small print. Watch out for restrictions on withdrawals and note whether the rate includes a bonus that will drop dramatically after a year.
- Apply – You can apply for ISAs online, by phone and in some cases in branch.
What do I need to apply?
Applying for an ISA should be fairly straightforward – but remember you can only open a cash ISA with one provider each year (you can, however, hold different ISAs from different providers in different years).
Things you will need to open an ISA:
- Basic details such as your name, address, date of birth, telephone number etc.
- Your national insurance number.
Things you may need to open an ISA:
- Details of a bank account you would like to link to your cash ISA
- Identification documents such as your passport or driving licence (although some banks do not require copies of these).
Certain providers may have additional requirements, so if you have left your application to the last minute and are planning to visit a branch, you should definitely check with the ISA provider which documents you will need, so you arrive prepared.
When you apply online, most banks will then send you a form to sign and send back. Some may require you to send photocopies of your proof of identification, however many now use an electronic ID verification process that in most cases removes the need to send physical evidence.
How late can I leave it?
Because 5 April falls on a Bank Holiday Monday this year the very last day you will be able to apply for an ISA in a branch is Saturday 4 April (that’s assuming the ISA can be opened in branch and the branch is open on Saturdays) If not, you might have to move by Thursday 1 April.
Some providers may even demand earlier action.
Working out the last day you can apply online or by phone is very difficult and many banks are reluctant to put a date on it. This is because there may be technical glitches or identity issues that take some customers longer to sort out than others. Plus, leaving things to the very last minute will of course leave you relying heavily on the postal system!
Basically, you should aim to apply as soon as possible. If you are reading this now and haven’t applied yet, what are you waiting for?
If you think you may have left it too late to apply, it’s always worth checking with individual providers whether you can still open an ISA with them – banks want your cash so are likely to try their best to help you meet the deadline!
Best buy ISAs
This ISA season Santander is leading the running with a cash ISA at 3.5%.
Higher rates are around for if you are willing to lock money away for longer, with Clydesdale and Yorkshire Bank offering 5% for a five-year fixed-rate ISA.
As the deadline approaches more banks and building societies will be announcing new deals, so it is necessary keep an eye on the market.