When it comes to saving money, a Cash ISA remains one of the most tax-efficient and straightforward options in the UK. With rising interest rates and competing providers, now is the time to review what’s out there. But with so many options, how do you choose between them and who truly offers the best Cash ISA rates?

In this guide, we’ll compare the top Cash ISA accounts, honing in on their rates and features to help you find the perfect fit for your saving style. Whether you're simply after the highest rates or want to ensure you can easily access your money, we've got you covered.

What is a Cash ISA and how does it work?

For those new to this concept, a Cash ISA (Individual Savings Account) is a tax-free savings account. It works similarly to a normal savings account - you deposit money and earn interest. The major difference is that you do not need to pay tax on any interest you earn within a Cash ISA. You can learn more about the different types of ISAs, the rules (including Cash ISA rules), allowances and deadlines in our Guide to ISAs.

How to choose a good Cash ISA

Each Cash ISA differs in terms of flexibility and accessibility. You should first determine which type of Cash ISA account fits your savings style and goals:

Flexibility

This determines how an ISA interacts with your ISA allowance. You might select a:

• Flexible Cash ISA - This type allows you to withdraw and re-deposit money within the same tax year without forfeiting an additional portion of your ISA allowance. 
• Non-Flexible Cash ISA - This type lacks the above benefit. If you withdraw and later redeposit the “same” money, the redeposit is seen as a new contribution and uses an additional portion of your ISA allowance.

Accessibility‍

This determines how quickly or frequently you can access your money without penalty. You might prefer a/an:

• Easy Access Cash ISA - Also known as an Instant Access Cash ISA, this type provides you with a variable interest rate but allows you easy access to your money, often instantly or within 1 day. 
• Limited Access Cash ISA - This type has a variable interest rate with limited access to your money, for example, a limited number of allowed withdrawals within the term.
• Fixed Rate Cash ISA - While this type provides you a fixed rate of interest, you may only access your money at the end of the fixed period.

Now that you're aware of the different features, let's compare the top Cash ISA accounts.
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Cash ISA comparison

This table compares providers with some of the best Cash ISA rates currently available:

Let’s look at each in more detail:
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Chip Cash ISA

Chip is currently offering an introductory interest rate of 5.26% AER (variable) for the first 3 months, the second highest bonus rate here. After this period, the rate drops to 4.32% AER (variable). The initial bonus rate is only available for new customers and you can use the code MARCHBOOST when registering to redeem it. Interest is paid out monthly and the minimum deposit is £1.

This easy access ISA is also a flexible ISA provided you don’t withdraw your entire Cash ISA balance at any given time. 

Chip is best for new customers who want a competitive bonus rate and automated savings tools in a flexible ISA but who are open to transferring later for better underlying rates.

‍Go to the Chip Cash ISA
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Tembo Money Cash ISA

Tembo is offering an interest rate of 4.8% AER (variable) with no introductory bonus which means this doesn’t drop off after a period. This is the highest of all the underlying Cash ISA interest rates we compared, hence why it’s the Editor’s Pick here. Interest accrues daily and is paid monthly. This one is accessible via the user-friendly Tembo app and there is a minimum deposit of just £10.

This is an easy access ISA however it is not a flexible ISA. Worth noting is that Tembo also came out on top when we analysed Lifetime Cash ISAs, with an interest rate of 4.6% AER (variable). 

Tembo is best for long-term savers who aren’t concerned with temporary bonus rates, don’t specifically need a flexible ISA and who want to jump straight to the highest underlying interest rate. 

‍Go to the Tembo Cash ISA
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Trading 2i2 Cash ISA

With the highest introductory interest rate of 5.32% AER (variable) for the first 3 months, this is one of the very best Cash ISA deals right now. After 3 months it drops to 4.5% AER (variable), which is still very competitive. The introductory bonus rate is only available to new customers but you can apply it using the promo code TI when registering. We have included it in the link below. Interest is paid monthly and there is a minimum deposit of £1.‍

This easy access ISA is flexible. In our Stocks and Shares ISA comparison, Trading 2i2 was also the top pick of US Stocks so if you’re also considering opening that type of ISA, this may be a great all-in-one platform.

Trading 2i2 is best for those who want the highest introductory rate available in a flexible ISA.

‍Go to the Trading 2i2 Cash ISA
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Hargreaves Lansdown Cash ISA

If you prefer big names and want a reputable platform with an array of options, then Hargreaves Lansdown (HL) might be the one to choose. HL partners with various banks, giving you the choice between Fixed Rate, Easy Access and Limited Access Cash ISAs.

The rates change frequently but at the time of writing, you could open an easy access Cash ISA with Atom Bank through HL for an interest rate of between 4.31% - 4.40% AER (variable). Interest is paid monthly and there is a minimum deposit of £1. ‍

Ease of access and flexibility will depend on which product you select through HL. 

The HL Cash ISA is best for those who want to choose between Easy Access, Limited and Fixed Term options while comparing Cash ISA savings rates. It also has some of the best Cash ISA rates for over 60s who may favor the platform’s traditional approach and added customer support.

‍Go to the Hargreaves Lansdown Cash ISA options
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Wealthify Cash ISA

Powered by ClearBank, Wealthify is offering an interest rate of 4.25% to 4.33% AER (variable). The trend continues in this case with interest being paid monthly and a minimum deposit of £1.‍

This easy access ISA is also flexible so you can withdraw and replace funds without impacting your ISA allowance. We also found Wealthify to be the best performing Managed ISA in our comparison of Stocks and Shares ISAs and Junior Stocks and Shares ISAs.  

While it doesn't top the charts of UK Cash ISA rates, it's still competitive and if you’re looking for a single platform for hands-off, managed savings and investing products, then Wealthify is definitely worth looking at. 

‍Go to the Wealthify Cash ISA
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Who is each best for? (TLDR Summary)

Here is the best Cash ISA if you want:

• The highest introductory interest rate - Trading 2i2
• The highest underlying interest rate - Tembo
• A traditional approach with the most choice - Hargreaves Lansdown

Last Word

Now that you have an idea of how the top Cash ISA accounts compare, you may wish to take a look at our guides to the best Stocks and Shares ISAs or Junior ISAs. We also compare all the types of ISAs and cover the rules in our Guide to ISAs. If you’re a client of ours and have any questions on this, please reach out to your accountant. If you’d like to become a client, please get in touch on this page.

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‍Remember, tax treatment depends on your individual circumstances and may be subject to change in the future. The value of your investments may go down as well as up. You may not get back all the money that you invest. This communication is not intended to be a personal recommendation. If you are unsure about the suitability of an investment product or service, you should seek advice from an authorised financial advisor.