What's the difference between a cash ISA and a stocks and shares ISA?

Cash ISAs

A cash ISA lets you save up to £20,000 each tax year. It works just like a savings account, except you don’t have to pay income tax on the interest you earn. Some cash ISAs will give you instant access to your savings, while others demand that you keep the money there for a fixed amount of time. You can also choose between a fixed interest rate or a variable interest rate for your savings. 

Currently, we don't offer a cash ISA. Our Stocks and shares ISA has a cash facility and the gross rate of interest we pay on cash held within the cash facility of any product wrapper is linked to the Bank of England Base Rate on a tiered basis, as explained in the table below. On the current base rate of 5.25% (as at 3 August 2023) that would be 2.94% (rounded to nearest 0.01%).

For example purposes only. 

Please visit the Bank of England website for up-to-date interest rates. You can also read more about this by visiting our support page.

Stocks and shares ISAs

A stocks and shares ISA is a tax-efficient investment account that allows you to invest in a wide range of shares, funds, investment trusts and bonds. Many companies offer fund solutions. These aim to make investing easy by offering a package of different investments held in one fund, designed to meet a risk appetite or a particular savings need.

The favourable tax treatment of ISAs may not be be maintained and is subject to change. The value of any tax benefits will depend on individual circumstances.

The value of an investment can fall as well as rise and isn't guaranteed. You could get back less than you invest.