Tax free savings: Maximise your cash ISA allowance before 5 April 2025. Here’s all you need to know

There is still time to maximise your tax-free savings, but with the end of the tax year approaching you need to act now!

Everyone wants their hard-earned money to bring them the best return, and ISAs are popular as you can save up to £20,000 a year tax-free – you won’t pay a penny on the interest earned.

We asked Market Harborough Building Society to tell us more about saving in an ISA:

“As the tax year draws to an end, it’s the perfect time to review your savings plans. Cash ISAs remain popular as savings accounts where you earn interest without tax deductions. This means you keep more of your money, helping your savings grow faster,” they explained.

Why have an ISA?

An ISA (Individual Savings Account) is a way to put aside money in a savings pot, and unlike other savings account it benefits from a tax-free annual allowance. 53%* of adult Brits don’t currently have an ISA. Research shows that those without an ISA are twice as likely to dip into their savings compared to those with an ISA. ISAs can help you stick to your savings goals!

How much do I need to invest?

Cash ISAs often have a minimum investment amount of £1 – and you can save up to £20,000 before the end of this tax year, April 5, tax-free.

Is it complicated?

Tax-efficient saving doesn’t have to be complicated. ISAs can be opened like a normal savings account, just make sure not to go over your £20,000 allowance. For more help contact Market Harborough on 01858 412412 or visit your local branch, where colleagues are on hand to help.

What if I already have an ISA?

You can contribute to your ISA at any time, up to the maximum annual allowance. Since 2024, you are allowed to have multiple ISAs. If you haven't deposited any money into a new ISA or added to an existing one this year, you can still save up to £20,000 tax-free. But remember, the end of the tax year is fast approaching on 5 April! If you haven't made the most of your 2024/2025 cash ISA allowance, now's the time to act.

Are all ISAs the same?

Everyone’s savings goals are different, and Market Harborough Building Society offers a range of ISAs to suit various needs.

Whether you’re saving for something in the near future or for a longer-term goal, choosing the right ISA can help you boost your savings. If you need access to your money, an easy access ISA might be the best option. On the other hand, if you plan to lock away your savings for a longer period, the notice ISA could offer a higher interest rate.

Check out the options available at Market Harborough Building Society here to see which is the right one for you.

Why are ISAs ‘tax efficient’?

If you earn over £1,000 in interest on your savings in a tax year, you might face an unexpected tax bill by exceeding your Personal Savings Allowance For higher rate taxpayers, this allowance drops to £500. Knowing these limits can help you plan your savings more effectively and avoid any surprises when it comes to paying tax on your savings. Any interest earned on savings held in an ISA don’t count towards your Personal Savings Allowance, making ISAs a valuable tool in your savings plan.

What if I miss the deadline?

If you want to save efficiently, you should use up your 2024/2025 ISA allowance of £20,000 before the 5 April tax deadline. For another chance to save, the standard ISA allowance remains unchanged at £20,000 per individual for the 2025/26 tax year.

*https://ifamagazine.com/just-one-in-seven-brits-use-their-full-isa-allowance-survey-shows/

Find out more

For more help, get in touch with Market Harborough Building Society today in branch or call 01858 412412. For more details visit the Market Harborough Building Society website here.