I’ve just opened a Chase Savings account that has 4.8% AER interest rate till 29 of October 2025. The 4.8% rate includes a boosted rate of 1.8% so that will drop on the 29th of October to 3% . I also have a Cash ISA with Trading 212 that I opened in 2023 and it has a total value of £41000, it’s currently 4.5% interest rate but dropping to 4.35% on the 1st of May. My question is can I move the entire value of my Cash ISA to take advantage of the higher interest rate [4.8%] of the Chase savings account till October? Will I be in violation of any ISA rules?
Yes I think you can as the ISA is flexible but you will be liable to pay tax on any interest earned above your personal allowances.
Thanks @Mark3. I was thinking about that because I’m a higher rate tax payer, to be honest, this is assuming that this mouth watering 4.8% interest rate is going to last till October, plan is to skim off the interest rate on a monthly basis from Chase and put it back into the Cash ISA, I’ll be adding new money to the chase savings account instead of the Trading 212 Cash ISA, but after October, I’ll move everything back to trading 212 anyway.
My calculations are that you would earn about ÂŁ90 more in interest but be liable to between ÂŁ190 and ÂŁ390 in additional tax? But that was just a quick calculation.
The 4.8% rate on Chase isn’t guaranteed until October, only the 1.8% boost. It’s still a variable interest account and they can drop the standard saver rate with the usual notice.
You’re right, that’s why I’m not rushing into this, with the next MPC meeting on the 8th of May expected to cut the base rate down to 4.25%, that will drop the Chase interest rate from 4.8 to approx 4.55%, still higher than 4.35% which will likely drop too to around 4.10%. decisions decisions decisions…
Not if I pay the interes back into the ISA
? If the interest is earned outside an ISA then it’s taxable regardless of what you do with it afterwards
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hmmmmm interesting. I see what you mean, I thought I could get away with putting the interest back into the Cash Isa to protect it from being taxed.
You could slide it over to the S&S ISA, which isn’t set to change 1 May. Loss against Chase rate would be negligible.
Thanks for the advice, I’m staying off the stock market at the moment, I don’t particularly want to place my hard earnings at the mercy of Donald. So putting my in the stock Market is not an option, not even a MMF. Nothing is as certain as the good old cash interest at the moment.
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Understood: Even MMFs can make you queasy in these absolutely unhinged times, despite their historical safety.