Products featured in this article are independently selected by This is Money’s specialist journalists. If you open an account using links which have an asterisk, This is Money will earn an affiliate commission. We do not allow this to affect our editorial independence. 

Savers rushing to make the most of their tax-free Isa allowance can beat the top easy-access cash Isa in our independent best buy tables by opening a tax-free account with Hargreaves Lansdown’s savings platform Active Savings.

It is once again offering new customers a £25 bonus when signing up for an account* from today.  

Currently, the top easy-access Isa rate it has on the platform is with Charter Savings Bank, which offers 5.03 per cent.

However, on a £10,000 balance – the minimum required to qualify for the bonus – that bump brings it up to a best buy 5.28 per cent. 

Give your Isa a boost: Hargreaves Lansdown is offering a £25 sign up bonus to customers

Give your Isa a boost: Hargreaves Lansdown is offering a £25 sign up bonus to customers

Give your Isa a boost: Hargreaves Lansdown is offering a £25 sign up bonus to customers 

This rate beats the top deal for an easy-access cash Isa, which is offered by Plum*, paying 5.15 per cent 

There has been strong competition among providers in the easy-access cash Isa market as the end of the tax year draws closer – but mainly from app-based upstarts.

Plum launched an easy-access cash Isa just last week, knocking competitor Chip off the top spot. Chip launched an easy-access cash Isa* paying 5.1 per cent two weeks ago. 

Not long before that, Moneybox boosted the rate on its easy-access cash Isa to 5.11 per cent. 

At the moment, the best-easy access Isa rates seem to be reserved from those who don’t mind downloading an app and managing their cash Isa from their phone or a tablet. 

Spread your Isa across banks ahead of new rules at Active Savings 

Savers will now be able to split their Isa allowance between different types of cash Isa and different providers. 

Hargreaves Lansdown’s cash platform Active Savings will allow savers to spread their Isa allowance across multiple banks, and easy-access, limited access and fixed rates.

> Read more: Hargreaves Lansdown’s savings platform’s new Isa perk

For those who don’t want to download an app, Hargreaves Lansdown’s online platform could be a good middle ground. 

Kent Reliance has an easy-access Isa paying a rate of 5.01 per cent, which can be opened online or in branch. 

To get the Active Savings bonus, savers must open an Active Savings account using this link* and fund an account with a minimum of £10,000 by 24 October 2024. 

That means you could sign-up for an account now, and wait until the new tax year to fund it – in case the investment platform giant pulls the offer. 

The sign-up bonus is also open to existing Hargreaves Lansdown customers who don’t have a cash Isa – but it doesn’t accept transfers in. 

Customers will receive the £25 sign-up bonus six months after the end of the offer. 

The bonus will be paid into customers’ Active Savings account provided they add £10,000 into an Isa. 

Savings tax trap 

With interest rates rising by so much over the last two years, many more savers are paying tax on the interest they earn on their savings, as they are using up their Personal Savings Allowance (PSA) with smaller deposits.

When rates were low this didn’t matter so much, as the PSA protected many from tax on their interest – albeit the £1,000 allowance is halved for higher rate taxpayers and eradicated for additional rate taxpayers.

Our picks of the five best cash Isas for 2024

Products featured in this article are independently selected by This is Money’s specialist journalists. If you open an account using links which have an asterisk, This is Money will earn an affiliate commission. We do not allow this to affect our editorial independence.

Plum* easy-access – 5.15%

– Facts: £100 to open

– Transfers in: Yes

 Moneybox easy-access – 5.11%

– Facts: £500 to open

– Transfers in: Yes

Castle Trust Bank one-year fix – 5.09%

– Facts: £1,000 to open

– Transfers in: Yes 

OakNorth Bank two-year fix – 4.7%

– Facts: £1 to open

– Transfers in: Yes 

Hargreaves Lansdown* easy-access – 5.28% (on £10,000+)

– Facts: £10,000 to open (for bonus rate)

– Transfers in: No 

 

This is why saving in an Isa is key for savers who want to shield as much of their hard-earned money from the taxman as possible. 

The best easy-access account on the market currently pays 5.08 per cent and is offered by Charter Savings Bank.

Someone putting £20,000 in this easy-access account would earn £1,040 of interest in a year.

So even a basic rate taxpayer would exceed their £1,000 annual tax-free savings allowance with a £20,000 deposit, while a higher-rate taxpayer (someone earning £50,271 to £125,140 a year) would easily breach their lower allowance of £500.

On £1,040 of annual interest, a higher rate taxpayer gets the first £500 tax free, but will be taxed at 40 per cent on the remaining £540, which means they would end up with £824 after tax.

Even a basic rate tax payer would end up paying £16 tax on their savings with this account, leaving them with £1,024. 

With an Isa, the interest will be tax free, regardless of the amount.

As a savings platform, Active Savings offers access to multiple savings products and banks. It allows savers to manage all their savings through a single online app-based account.

When you add money to an Isa or any other savings account on the platform, it is held by that bank or building society.

All of Active Savings’ partner banks are authorised by the Prudential Regulation Authority (PRA) and covered under the Financial Services Compensation Scheme.

Deposits are protected up to £85,000 per banking licence in the event that the bank or building society fails. Any deposits over £85,000 with the same provider are not likely to be covered.

Mark Hicks, head of Active Savings at Hargreaves Lansdown, said: ‘This cashback offer is ideal for those rushing at the last minute to make the most of their Isa allowance this year and for those early birds in the next tax year that have already filled their allowance.’

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