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Cash ISA

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A simple, tax-free way to save

Cash ISA - rates from 0.50% AER (0.50% tax-free) to 3.00% AER (2.96% tax-free) variable depending on your balance.

It's important to save for the future - and whether you’re saving towards a particular goal or purchase, our Cash ISA, which pays 3.00% AER (2.96% tax-free) variable on balances of £40,000 and over, could be a firm step in the right direction. You can start saving from £1, you earn tax-free interest, and you get instant access to your money whenever you like. And it's so simple, you can complete your ISA Account application online.

  • tax free interest
  • interest is calculated daily and applied monthly
  • instant access by a transfer to another first direct account
  • transfers from other providers allowed
  • apply and manage online, by post or by telephone.

A brief introduction to ISAs

A cash ISA is a way of saving or investing without paying tax on your earnings, since all income and capital gains arising within an ISA are exempt from any personal liability to UK income tax and capital gains tax. A payment by you into an ISA in any tax year is called a subscription. The overall ISA subscription limit in the current Tax Year is £11,280 for anyone eligible to invest in an ISA. Up to £5,640 of this overall limit can be saved in a cash ISA with one provider. See How much can I save? for more information on subscriptions limits.

There are two types of ISA - a stocks and shares ISA, and a cash ISA. We offer both, but you can only take out one of each per year.

All ISA providers are required to report details of ISA subscriptions made by their customers to HM Revenue & Customs (HMRC) so that HMRC can check that individuals do not exceed the limits.

ISAs may be transferred to another ISA with the same or a different ISA provider. When an ISA is transferred in this way, the amount transferred is not a subscription and therefore does not count towards the subscription limits explained above. It is not possible to transfer a stocks and shares ISA to a cash ISA.

That means you can transfer any ISA balances to us, held with other providers, from previous or current tax years. (Transfers from existing first direct cash ISAs to another first direct cash ISA with a fixed rate are not permitted.)

The value of stocks and shares ISAs can fall as well as rise and you may not get back the amount you originally invested.

You should plan to invest over the medium to long term, at least five years as a minimum.

 
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Cash ISA at a glance

Our Cash ISA lets you enjoy tax-free growth and instant access to your money if you need it. This information will give you a better idea of what's involved - though please make sure you read the Interest Rates and Charges and
Terms and Conditions before you apply.

Our downloads are in a PDF format. To read them you'll need to have Adobe Reader 4.0™ or above. It's free and you can get Adobe Reader here.

 

Cash ISA rates

Balance AER Tax free
£1+ 0.50% 0.50%
£5,000+ 1.20% 1.19%
£10,000+ 1.70% 1.69%
£20,000+ 2.20% 2.18%
£40,000+ 3.00% 2.96%

 

Summary box and Key Product Information
Account Name

Cash ISA.
Interest rates

Tiered interest rates on balances above £1.

Interest calculated daily and applied monthly.

see our interest rates and charges information for full details
Tax status

ISAs are free from personal liability to any UK Income tax and Capital Gains Tax.
Conditions for bonus payment

No bonus payments on this account.
Withdrawal Arrangements

Charge free instant withdrawals can be made by transfer to another first direct account in your name, over the phone or via Internet Banking. Transfers to other banks may take longer.
Access

The account can be applied for and managed online, by telephone or by post.

 

Other things you should know

 

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How much can I save?

Because of their tax advantages ISAs are subject to annual subscription limits. The overall ISA subscription limit in the current Tax Year is £11,280 for anyone eligible to invest in an ISA. Up to £5,640 of this overall limit can be saved in a cash ISA with one provider. The remainder of the £11,280 can be invested in a stocks and shares ISA with either the same or another provider. Alternatively, the full £11,280 can be invested in a stocks and shares ISA with one provider.

However, once you've paid in £5,640 into a Cash ISA, you can't make additional Cash ISA deposits - even if the Cash ISA balance is below £5,640 because you've made a withdrawal. If you have fully subscribed your tax-free allowance in a tax year, any amount withdrawn cannot be reinvested until the following Tax Year.

You can also transfer any ISA balances to us, held with other providers, from previous or current tax years. (Transfers from existing first direct cash ISAs to another first direct cash ISA with a fixed rate are not permitted). There are no maximum limits on the amount that can be transferred to our cash ISA from another cash ISA held with another provider.

You can only subscribe to one cash ISA in a tax year. Any subscription made to a cash ISA will reduce the remaining overall ISA allowance that can be subscribed to a stocks and shares ISA in the same tax year.
How to manage my account

The account application details can be completed online or via a paper application but, once it's open, you can manage your account online, by telephone or by post.
How to apply

To apply for a Cash ISA you must already hold a first direct current account - our 1st Account. If you already have a 1st Account, you can open a Cash ISA online, by telephone or by post.
What else should I know?

You need to be over 18 and a UK resident.

Definitions

AER stands for Annual Equivalent Rate. This shows you what the gross rate would be if interest were paid and compounded each year.

Gross is the interest rate before the deduction of tax applicable to interest on savings accounts.

Tax-free free from personal liability to any UK Income Tax and Capital Gains Tax.

 

The value of the tax benefits described depends on individual circumstances. The tax treatment of ISAs could change in the future.

 

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How to apply for a Cash ISA

Already a customer?

You can apply online through your Internet Banking. As you're currently logged in, just select Apply online from the left hand menu within Internet Banking

Log on to apply

Once you've logged on to Internet Banking, just select 'Apply', and choose 'Cash ISA' from the left hand menu.

If you haven't yet registered for Internet Banking, simply click on the link below and enter your support and access ID details. If you haven't received your support and access IDs, please call us on 08 456 100 100.

Register for Internet Banking

Or to apply over the telephone call us on:
08 456 100 100

You can request an application to open a Cash ISA for the current Tax Year over the telephone.

download a Cash ISA application form

Not yet a customer?

To open a Cash ISA you will also need to open a first direct 1st Account, our current account.

Learn more about the 1st Account

You can also talk to us anytime on:
0800 24 24 24

Useful documents:

Cash ISA guide

Cash ISA transfer request form

ISA standing order form

Cash ISA Transfer Guidelines

 

Our downloads are in a PDF format. To read them you'll need to have Adobe Reader 4.0™ or above. It's free and you can get Adobe Reader here.

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