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Variable rate ISAs are tax-efficient savings accounts that pay a variable rate of interest. This means their rates may increase or decrease as the Bank of England base rate changes.  If you would like more information about variable rate ISAs read our guide below.

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AA Logo
AA AA ISA - Member Easy Access Issue 3 FSCS logo
FSCS logo
AER
1.43%
Account Type
Cash ISA
Notice / Term
None
Interest Paid
Yearly
Opening Account
Available Online Not Available At Branch Not Available By Mail Not Available By Telephone Not Available By Mobile
Managing Account
Available Online Not Available At Branch Not Available By Mail Not Available By Telephone Not Available By Mobile
Go To Provider's Site
Rates
Access
Information
Opening Restrictions
ISA Information
Additional Information

Rates

Rate 1.43% paid at £100
AER 1.43% paid at £100
Interest Paid Yearly
Interest payment Interest must be compounded
Min Opening Amount £100
Max Investment £0
Introductory bonus N/A

Access

Withdrawals Allowed
Early Access Allowed
Access Note
All withdrawals via nominated account or to an existing AA ISA product.
Further Additions Allowed

Information

Min Age 16
Max Age 0
Taxation
Interest is paid tax free

Opening Restrictions

Available to AA breakdown members only

ISA Information

Transfers In - Cash ISAs
Transfers In - Stocks & Shares ISAs
Transfers In - Help to Buy ISAs
Additional Permitted Subscription ISA
Transfer Notes -
Flexible Rules Apply
Split ISA Allowance Between Different ISAs With Same Provider

Additional Information

N/A
AA Logo
AA AA ISA - Easy Access Issue 15 FSCS logo
FSCS logo
AER
1.42%
Includes a bonus
Account Type
Cash ISA
Notice / Term
None
Interest Paid
Yearly
Opening Account
Available Online Not Available At Branch Not Available By Mail Not Available By Telephone Not Available By Mobile
Managing Account
Available Online Not Available At Branch Not Available By Mail Not Available By Telephone Not Available By Mobile
Go To Provider's Site
Rates
Access
Information
Opening Restrictions
ISA Information
Additional Information

Rates

Rate 1.42% paid at £100
AER 1.42% paid at £100
Interest Paid Yearly
Interest payment Interest must be compounded
Min Opening Amount £100
Max Investment £0
Introductory bonus Rate includes 1.22% bonus for 12 months

Access

Withdrawals Allowed
Early Access Allowed
Access Note
All withdrawals via nominated account or to an existing AA ISA product.
Further Additions Allowed

Information

Min Age 16
Max Age 0
Taxation
Interest is paid tax free

Opening Restrictions

N/A

ISA Information

Transfers In - Cash ISAs
Transfers In - Stocks & Shares ISAs
Transfers In - Help to Buy ISAs
Additional Permitted Subscription ISA
Transfer Notes -
Flexible Rules Apply
Split ISA Allowance Between Different ISAs With Same Provider

Additional Information

N/A
Scottish BS Logo
Scottish BS Loyalty Cash ISA FSCS logo
FSCS logo
AER
1.65%
Account Type
Cash ISA
Notice / Term
Instant
Interest Paid
Yearly
Opening Account
Not Available Online Available At Branch Available By Mail Not Available By Telephone Not Available By Mobile
Managing Account
Not Available Online Available At Branch Available By Mail Not Available By Telephone Not Available By Mobile
Rates
Access
Information
Opening Restrictions
ISA Information
Additional Information

Rates

Rate 1.65% paid at £1
AER 1.65% paid at £1
Interest Paid Yearly
Interest payment Interest can be paid away or compounded
Min Opening Amount £1
Max Investment £0
Introductory bonus N/A

Access

Withdrawals Allowed
Early Access Allowed
Access Note
N/A
Further Additions Allowed

Information

Min Age 16
Max Age 0
Taxation
Interest is paid tax free

Opening Restrictions

Existing Customers (who have held an ISA prior to tax year 2012/13)

ISA Information

Transfers In - Cash ISAs
Transfers In - Stocks & Shares ISAs
Transfers In - Help to Buy ISAs
Additional Permitted Subscription ISA
Transfer Notes Transfers in are not permitted for new customers.
Flexible Rules Apply
Split ISA Allowance Between Different ISAs With Same Provider

Additional Information

N/A
Scottish BS Logo
Scottish BS Loyalty Cash ISA FSCS logo
FSCS logo
AER
1.55%
Account Type
Cash ISA
Notice / Term
Instant
Interest Paid
Yearly
Opening Account
Not Available Online Available At Branch Available By Mail Not Available By Telephone Not Available By Mobile
Managing Account
Not Available Online Available At Branch Available By Mail Not Available By Telephone Not Available By Mobile
Rates
Access
Information
Opening Restrictions
ISA Information
Additional Information

Rates

Rate 1.55% paid at £1
AER 1.55% paid at £1
Interest Paid Yearly
Interest payment Interest can be paid away or compounded
Min Opening Amount £1
Max Investment £0
Introductory bonus N/A

Access

Withdrawals Allowed
Early Access Allowed
Access Note
N/A
Further Additions Allowed

Information

Min Age 16
Max Age 0
Taxation
Interest is paid tax free

Opening Restrictions

Existing Customers (ISA accounts opened in tax year 2012/13)

ISA Information

Transfers In - Cash ISAs
Transfers In - Stocks & Shares ISAs
Transfers In - Help to Buy ISAs
Additional Permitted Subscription ISA
Transfer Notes Transfers in are not permitted for new customers.
Flexible Rules Apply
Split ISA Allowance Between Different ISAs With Same Provider

Additional Information

N/A
Buckinghamshire BS Logo
Buckinghamshire BS 180 Day Cash ISA FSCS logo
FSCS logo
AER
1.51%
Account Type
Cash ISA
Notice / Term
180 Day
Interest Paid
Monthly
Opening Account
Not Available Online Available At Branch Available By Mail Not Available By Telephone Not Available By Mobile
Managing Account
Not Available Online Available At Branch Available By Mail Not Available By Telephone Not Available By Mobile
Rates
Access
Information
Opening Restrictions
ISA Information
Additional Information

Rates

Rate 1.50% paid at £100
AER 1.51% paid at £100
Interest Paid Monthly
Interest payment Interest must be paid away
Min Opening Amount £100
Max Investment £0
Introductory bonus N/A

Access

Withdrawals Allowed
Early Access Allowed
Access Note
Earlier access subject to 180 day loss of interest.
Further Additions Allowed

Information

Min Age 16
Max Age 0
Taxation
Interest is paid tax free

Opening Restrictions

N/A

ISA Information

Transfers In - Cash ISAs
Transfers In - Stocks & Shares ISAs
Transfers In - Help to Buy ISAs
Additional Permitted Subscription ISA
Transfer Notes -
Flexible Rules Apply
Split ISA Allowance Between Different ISAs With Same Provider

Additional Information

N/A
Buckinghamshire BS Logo
Buckinghamshire BS 180 Day Cash ISA FSCS logo
FSCS logo
AER
1.50%
Account Type
Cash ISA
Notice / Term
180 Day
Interest Paid
Yearly
Opening Account
Not Available Online Available At Branch Available By Mail Not Available By Telephone Not Available By Mobile
Managing Account
Not Available Online Available At Branch Available By Mail Not Available By Telephone Not Available By Mobile
Rates
Access
Information
Opening Restrictions
ISA Information
Additional Information

Rates

Rate 1.50% paid at £100
AER 1.50% paid at £100
Interest Paid Yearly
Interest payment Interest can be paid away or compounded
Min Opening Amount £100
Max Investment £0
Introductory bonus N/A

Access

Withdrawals Allowed
Early Access Allowed
Access Note
Earlier access subject to 180 day loss of interest.
Further Additions Allowed

Information

Min Age 16
Max Age 0
Taxation
Interest is paid tax free

Opening Restrictions

N/A

ISA Information

Transfers In - Cash ISAs
Transfers In - Stocks & Shares ISAs
Transfers In - Help to Buy ISAs
Additional Permitted Subscription ISA
Transfer Notes -
Flexible Rules Apply
Split ISA Allowance Between Different ISAs With Same Provider

Additional Information

N/A
Coventry BS Logo
Coventry BS Easy Access ISA (Online) (2) FSCS logo
FSCS logo
AER
1.50%
Includes a bonus
Account Type
Cash ISA
Notice / Term
None
Interest Paid
Monthly
Opening Account
Available Online Not Available At Branch Not Available By Mail Not Available By Telephone Not Available By Mobile
Managing Account
Available Online Not Available At Branch Not Available By Mail Not Available By Telephone Not Available By Mobile
Rates
Access
Information
Opening Restrictions
ISA Information
Additional Information

Rates

Rate 1.49% paid at £1
AER 1.50% paid at £1
Interest Paid Monthly
Interest payment Interest can be paid away or compounded
Min Opening Amount £1
Max Investment £0
Introductory bonus Rate includes 0.35% bonus until 31.08.2020

Access

Withdrawals Allowed
Early Access Allowed
Access Note
N/A
Further Additions Allowed

Information

Min Age 16
Max Age 0
Taxation
Interest is paid tax free

Opening Restrictions

N/A

ISA Information

Transfers In - Cash ISAs
Transfers In - Stocks & Shares ISAs
Transfers In - Help to Buy ISAs
Additional Permitted Subscription ISA
Transfer Notes -
Flexible Rules Apply
Split ISA Allowance Between Different ISAs With Same Provider

Additional Information

N/A
Coventry BS Logo
Coventry BS Easy Access ISA (Online) (2) FSCS logo
FSCS logo
AER
1.50%
Includes a bonus
Account Type
Cash ISA
Notice / Term
None
Interest Paid
Yearly
Opening Account
Available Online Not Available At Branch Not Available By Mail Not Available By Telephone Not Available By Mobile
Managing Account
Available Online Not Available At Branch Not Available By Mail Not Available By Telephone Not Available By Mobile
Rates
Access
Information
Opening Restrictions
ISA Information
Additional Information

Rates

Rate 1.50% paid at £1
AER 1.50% paid at £1
Interest Paid Yearly
Interest payment Interest can be paid away or compounded
Min Opening Amount £1
Max Investment £0
Introductory bonus Rate includes 0.35% bonus until 31.08.2020

Access

Withdrawals Allowed
Early Access Allowed
Access Note
N/A
Further Additions Allowed

Information

Min Age 16
Max Age 0
Taxation
Interest is paid tax free

Opening Restrictions

N/A

ISA Information

Transfers In - Cash ISAs
Transfers In - Stocks & Shares ISAs
Transfers In - Help to Buy ISAs
Additional Permitted Subscription ISA
Transfer Notes -
Flexible Rules Apply
Split ISA Allowance Between Different ISAs With Same Provider

Additional Information

N/A
Kent Reliance Logo
Kent Reliance Cash ISA - 2 Year Tracker - Issue 7 FSCS logo
FSCS logo
AER
1.50%
Account Type
Cash ISA
Notice / Term
2 Year Bond
Interest Paid
Monthly
Opening Account
Available Online Available At Branch Available By Mail Not Available By Telephone Not Available By Mobile
Managing Account
Available Online Available At Branch Available By Mail Not Available By Telephone Not Available By Mobile
Rates
Access
Information
Opening Restrictions
ISA Information
Additional Information

Rates

Rate 1.49% paid at £1K
AER 1.50% paid at £1K
Interest Paid Monthly
Interest payment Interest can be paid away or compounded
Min Opening Amount £1,000
Max Investment £0
Introductory bonus N/A

Access

Withdrawals Allowed
Early Access Allowed
Access Note
Earlier access on 180 day loss of interest. Withdrawal method dependent on how a/c is opened.
Further Additions Allowed
At the end of the fixed term
Your provider will write to you before the account matures. If you don’t give them any instructions, the money in the account will be reinvested in a further Fixed Rate/Fixed Term account on equivalent/similar terms

Information

Min Age 16
Max Age 0
Taxation
Interest is paid tax free

Opening Restrictions

N/A

ISA Information

Transfers In - Cash ISAs
Transfers In - Stocks & Shares ISAs
Transfers In - Help to Buy ISAs
Additional Permitted Subscription ISA
Transfer Notes Transfer requests must be made within 30 days of account opening.
Flexible Rules Apply
Split ISA Allowance Between Different ISAs With Same Provider

Additional Information

N/A
Kent Reliance Logo
Kent Reliance Cash ISA - 2 Year Tracker - Issue 7 FSCS logo
FSCS logo
AER
1.50%
Account Type
Cash ISA
Notice / Term
2 Year Bond
Interest Paid
Yearly
Opening Account
Available Online Available At Branch Available By Mail Not Available By Telephone Not Available By Mobile
Managing Account
Available Online Available At Branch Available By Mail Not Available By Telephone Not Available By Mobile
Rates
Access
Information
Opening Restrictions
ISA Information
Additional Information

Rates

Rate 1.50% paid at £1K
AER 1.50% paid at £1K
Interest Paid Yearly
Interest payment Interest can be paid away or compounded
Min Opening Amount £1,000
Max Investment £0
Introductory bonus N/A

Access

Withdrawals Allowed
Early Access Allowed
Access Note
Earlier access on 180 day loss of interest. Withdrawal method dependent on how a/c is opened.
Further Additions Allowed
At the end of the fixed term
Your provider will write to you before the account matures. If you don’t give them any instructions, the money in the account will be reinvested in a further Fixed Rate/Fixed Term account on equivalent/similar terms

Information

Min Age 16
Max Age 0
Taxation
Interest is paid tax free

Opening Restrictions

N/A

ISA Information

Transfers In - Cash ISAs
Transfers In - Stocks & Shares ISAs
Transfers In - Help to Buy ISAs
Additional Permitted Subscription ISA
Transfer Notes Transfer requests must be made within 30 days of account opening.
Flexible Rules Apply
Split ISA Allowance Between Different ISAs With Same Provider

Additional Information

N/A

Select a Savings Account

Note

Eligible deposits with UK institutions are protected by the Financial Services Compensation Scheme up to a maximum level of protection of £85,000 per person per institution.

Disclaimer

All rates subject to change without notice. Please check all rates and terms before investing or borrowing.

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Still not sure?

Read our Savings and ISA guides
guide icon
2019-20 ISA allowance guide

A short guide detailing the 2019-20 ISA allowances.

Read More
guide icon
What is a cash ISA?

This guide covers all you need to know about Cash ISA.

Read More
guide icon
Six things you need to know about ISA transfers

Six things you need to know about ISA transfers.

Read More
guide icon
One year fixed rate ISA

Our guide to 1 Year Fixed Rate ISAs.

Read More

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A guide to variable rate ISAs

Leanne Macardle

Leanne Macardle

Editor
Published: 29/01/2019

At a glance

  • Variable rate ISAs offer tax-free savings that give customers the option of accessing their funds either immediately or after a certain notice period.
  • While ISAs come with certain restrictions, their tax-exempt status makes them a valuable tool in any saver’s investment toolbox.

What is a variable rate ISA?

The term variable rate ISA largely explains itself: it’s a cash ISA that offers a variable rate of interest. If you’re unfamiliar with the concept, an ISA – or Individual Savings Account – allows people in the UK to save without having to worry about taxation.

For a more general overview of cash ISAs, go to the cash ISA page.

While they come with more restrictions than non-ISA accounts, variable cash ISAs still offer plenty of flexibility. There are generally two types of variable ISA: notice accounts and easy access accounts. Variable rate ISAs with a notice period usually require some advance warning before the bank or building society will let you take the funds out of your account, while easy access ISAs generally allow additions and withdrawals without limit, however there are now an increasing number of providers that restrict how many withdrawals can be made in a year.

This is in contrast with fixed rate ISAs, which typically do not allow any access until a certain period has passed, in exchange for higher and set rates. Even if you find the best variable ISA rate, and this can beat fixed rates, there’s always a chance that it can lessen over time – hence the variable part. While this makes it a gamble, the access options these accounts offer could certainly make it worth the risk.

Why should I choose one?

The main benefit of any ISA is that your savings remain tax-free for as long as they are in an ISA. This means you can accumulate quite a savings pot over time, which may well be able to gain enough interest to breach the Personal Savings Allowance.

Specific reasons to pick a variable cash ISA are if you think rates might increase soon and you don’t want to commit your funds to a fixed rate deal, or if you are approaching the time when you will require the funds – such as when you’re closing in on that all-important first home deposit amount.

Most variable rate ISAs will allow you to withdraw your funds – either instantly or following a notice period. Additionally, ISA rules allow you to withdraw and replace funds within the same tax year without this impacting on your ISA allowance (see below). This makes them an excellent choice for people who want to eventually save up a large pot of money but don’t want to lose access.

How much can I save in a variable ISA?

Per tax year (which runs from 6 April of one year to 5 April of the next year), you are restricted by the ISA allowance as to what you can put away. For both the 2018/19 and 2019/20 tax years, the ISA allowance stands at £20,000.

This means that you can put this amount of money into a new or existing variable rate ISA. If you also want to save in a different kind of ISA (say a stocks & shares ISA), you should note that the allowance covers all of them combined. So, if you want to save in both a cash ISA and stocks & shares ISA, you’ll have to decide whether you want to put an equal £10,000 in each account or divide the funds up differently.

While you’re only able to put a certain amount of new money into an ISA per tax year, you are able to transfer your existing ISA funds across providers without limit. So, if you see a better variable rate elsewhere, you should be able to transfer your whole pot over in one go – just be sure to follow the ISA rules, otherwise you might end up getting in trouble. Bear in mind that not all ISAs allow funds to be transferred in, it depends on the provider.

Have a look at our guide on transferring ISAs to see what you need to do to avoid your funds falling out of ISAs altogether and potentially becoming liable to taxation.

How many ISAs can I have?

Related to the ISA allowance are some opening restrictions that might make ISAs slightly less appealing than non-ISA accounts. While you can have as many ISAs as you want, you can only open one new ISA of each type per tax year.

Unless the provider allows the allowance to be shared among its range of ISAs, this means you will have to pick whether you want to open a fixed or variable cash ISA. While opening the new variable ISA saver, you could however choose to also transfer funds into the account from another ISA, so you can accumulate more than just the ISA allowance into your new account within the tax year.

Similarly, there are no restrictions when it comes to how many ISAs you can have open. So, it may take some years, but you could have dozens of separate ISAs eventually – though this will likely make oversight and administration of them quite complicated.

Advantages and disadvantages

  • Tax-free while the funds remain in the ISA
  • Access possible either instantly or with a certain amount of notice
  • Can withdraw and replace funds within the same tax year, if needed (if your provider allows this, not all do)
  • Can add funds throughout the year if you’d rather not invest the full ISA allowance in one go
  • Variable ISA interest rates tend to be somewhat lower than their non-ISA variable savings counterparts, but this depends on the wider market
  • Can only put in so much per tax year
  • ISAs come with certain restrictions that limit the number of accounts you can open per year

Is my money safe in an ISA?

When it comes to cash ISAs, the same depositor protection schemes apply as with other UK savings accounts. That means that £85,000 of your savings are protected per banking institution – unless you’re choosing to save with the Government-backed National Savings & Investments (NS&I), as they can guarantee 100% of your savings remain protected.

man holding twenty pound bank notes

At a glance

  • Variable rate ISAs offer tax-free savings that give customers the option of accessing their funds either immediately or after a certain notice period.
  • While ISAs come with certain restrictions, their tax-exempt status makes them a valuable tool in any saver’s investment toolbox.
Best Variable Rate ISAs
Provider AER Account Type Notice / Term Min Investment
Scottish BS Logo Scottish BS Loyalty Cash ISA 1.65% Cash ISA Instant £1
Scottish BS Logo Scottish BS Loyalty Cash ISA 1.55% Cash ISA Instant £1
Buckinghamshire BS Logo Buckinghamshire BS 180 Day Cash ISA 1.51% Cash ISA 180 Day £100
Buckinghamshire BS Logo Buckinghamshire BS 180 Day Cash ISA 1.50% Cash ISA 180 Day £100

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