Fixed Rate Cash ISA
Tax-free saving and guaranteed interest rate for a fixed term
Want to make a lump sum deposit and leave your money to grow tax-free? You could consider a Fixed Rate Cash ISA. In the first 30 days you can pay in up to £15,000 (for the tax year 2014/15 - this is the combined limit for both Stocks and Shares and Cash ISAs) and we reward you with a fixed interest rate.
How our Fixed Rate Cash ISA works
Get started with your ISA
Make the most of your tax-free savings with minimum effort.
Once your Fixed Rate Cash ISA is set up, you have 30 days to make as many deposits as you like up to the maximum allowance of £15,000 for the 2014/15 tax year - this is the combined limit for both Stocks and Shares and Cash ISAs.
Just register for online and telephone banking, then deposits are quick and easy. You can use our handy mobile banking app too. Once your money is in, you just sit back while it grows.
Transfer your existing ISA
If you already have some ISA savings, you can transfer your existing ISAs to a Tesco Bank Cash ISA and keep all your tax-free savings in one place. With our Fixed Rate Cash ISA, you need to do this in the first 30 days after the account is opened.
Remember to check with your existing ISA provider first, as they may have restrictions on transfers.
To understand more about types of ISA and your tax-free savings allowance, take a look at the important information. Important information
What you can transfer
You can transfer ISA subscriptions (money paid in) without losing your tax free benefit. You can transfer subscriptions in the following ways:
- Between ISA providers
- Between different Tesco Bank Cash ISA accounts
- Between Cash ISAs and Stocks and Shares ISAs (Tesco Bank only offers Cash ISAs)
- To ensure your interest payments remain tax free, you need to transfer your funds using the ISA transfer process. This process is offered by Tesco Bank and most other providers.
You can transfer:
- All of your current year's subscriptions to a Cash ISA or a Stocks & Shares ISA. You can then make further subscriptions to your new ISA in the same tax year, as long as you don't exceed your annual allowance.
- All or part of any subscription made in previous tax years.
- You can only subscribe to one Cash ISA and one Stocks and Shares ISA in a tax year; however, you can hold multiple Cash ISAs and Stocks and Shares ISAs as long as the subscriptions were made in different tax years. In addition, if you have previously subscribed to a Cash ISA in the year but subsequently transferred your money to a Stocks and Shares ISA, you will still be able to use any remaining ISA allowance up to the annual tax-free allowance of £15,000.
Other providers may have restrictions on transfers, so you should always check this with them before transferring money to another provider.
How to transfer an existing ISA to Tesco Bank
New customers should complete an application either online or by calling us on 0845 678 5678, and we can begin the transfer process during the application.
Remember, if you are making a transfer to our Fixed Rate Cash ISA you must do this within 30 days of account opening.
Access to your money
12-month fixed term
Make sure you’re comfortable with putting your money away for 12 months.
The Tesco Bank Fixed Rate Cash ISA gives you a guaranteed interest rate for one year - but this means that you can't withdraw any money during the fixed term unless you close your account and withdraw all of the money.
If you close your account or transfer your money out of it during the fixed term, we'll charge you a fee equal to 30 days' interest on the balance of your account.
At the end of your fixed term
When your fixed rate period ends, the account will become an Instant Access Cash ISA (or another Cash ISA available at that time), and your money will earn the variable standard ISA rate that applies at that time.
Shortly before this happens, we'll write to you to remind you.
Once it’s switched over, you have lots of options. You can choose to keep your funds in the account, choose another ISA or savings account from Tesco Bank, transfer your money to another provider or withdraw the funds without charge.
Our interest rates
The annual interest rate is 1.50% Gross/AER. This is fixed for the 12- month term of your ISA as long as your money is kept in the ISA for the fixed term.
Interest rate is correct as at 13 January 2015.
At the end of your fixed rate period, your money will earn our variable ISA standard rate that applies at that time.
See the information on accessing your money to learn more about what happens at the end of your fixed term. Access to your money
Interest rate definitions
- Gross is the interest rate paid before tax is deducted.
- Annual Equivalent Rate (AER) illustrates what the interest rate would be if it was paid and compounded each year.
How interest is calculated and paid
Interest is calculated daily and is added to your ISA account on the anniversary of the account opening. The interest paid is tax free.
The current rules for ISAs are subject to change by HM Revenue & Customs and the value of tax benefits depends on individual circumstances.
Financial Services Compensation Scheme
Your eligible deposits with Tesco Bank are protected up to a total of £85,000 by the Financial Services Compensation Scheme, the UK's deposit protection scheme. Any deposits you hold above the £85,000 limit are not covered.
Apply for a Fixed Rate Cash ISA today
Have a question or need help applying? Our friendly, UK-based customer service team is here to help.
Other customers have been asking:
Help for existing customers
Customer services 0845 678 5678
Customer services textphone 0845 671 0672
Lines are open Monday to Friday 8am-10pm, Saturday and Sunday 9am-5pm.
Term coming to an end?
Learn more about what happens when your Fixed Rate Cash ISA is coming to the end of the 12-month term.
Need help with online banking?
Having trouble registering or managing your account online? Don't worry, we're here to help.
Other ways to save
Summary of key information
Key information for our Fixed Rate Cash ISA
Tesco Bank Fixed Rate Cash ISA
|Interest rates (AERs)|
The rate of interest for this account will be confirmed when you open the account. Please note - interest is paid into the account on the anniversary of the account opening.
There is no tax payable on the interest earned on this account.
|Conditions for bonus payment|
Closing the account and making transfers to other ISA providers before the end of the fixed term will incur a fee equivalent to 30 days' interest on the balance of the account.
|Daily withdrawal limits|
If you want to make a withdrawal from this account you must close the account and withdraw the whole balance of the account.
You can manage the account by signing up to online banking or telephone banking.
Types of ISA and allowances
There are two types of ISA: a Stocks and Shares ISA and a Cash ISA.
You can subscribe to one Stocks and Shares ISA and one Cash ISA each tax year. The tax year runs from 6 April to 5 April the following year.
On 1 July 2014 the ISA limit increased to £15,000. This is the maximum amount you can pay in total into ISAs this tax year.
This can be paid into a Stocks and Shares ISA, a Cash ISA or a combination of both.
For example, if you saved £10,000 into a Cash ISA in this tax year, the maximum which can be saved into the Stocks and Shares ISA in the same tax year is £5,000.
Tesco Bank only offers a Cash ISA.
If you decide to cancel your Cash ISA, this won't affect your ISA allowance for the current tax year and you can still open another Cash ISA in that tax year. You have 30 days from receiving your welcome letter to cancel your Cash ISA. If you do cancel, we'll refund the money you've paid in.
Cash ISA changes for 2014/15 tax year
The government announced at Budget 2014 that from 1 July 2014, ISAs (Individual Savings Accounts) will be reformed into a new simpler product, the New ISA (NISA) with a combined limit for Cash ISAs and Stocks and Shares ISAs.
From 1 July 2014 the subscription limit increased to £15,000 - the biggest ever increase to ISA limits.
Tesco Bank only offers Cash ISAs, and not Stocks and Shares ISAs but the good news is that your Tesco Bank Cash ISA will automatically become a Cash NISA (although we will still call it an ISA), therefore you can take advantage of the increased subscription limits from 1 July 2014.
The New ISA will also offer you the option to save your whole allowance of £15,000 in cash, stocks and shares, or any combination of the two.
For example you could choose to pay in:
- £15,000 to a Cash ISA and nothing to a Stocks and Shares ISA
- £15,000 to a Stocks and Shares ISA and nothing to a Cash ISA
- A combination of amounts between a Cash and Stocks and Shares ISA, up to the overall annual limit of £15,000