the whole thing has become a joke. i have an isa maturing this week and they have offered me a transfer into a 1 year fixed rate isa at a paltry 1.5%. i can get 3.15% on a phone account with instant access (well 3-4 banking days to transfer the cash - also a huge geat joke in this electronic age !!) WITH THE SAME OUTFIT - birmingham midshires. given this scenario i am seriously considering having the cash out and playing the markets. I reckon i can do a lot better than 1.5% p.a. the only decent rates out there are on 5 year money - who wants to fix for 5 years when base rate is at an all time low ??

so much for the uk gov trying to encourage savers via isas !!!

I agree.

Some of the higher interest bonds do require £10k+ and some people are lucky (?) enough to pay 40% tax but yes, there are tax advantages with ISAs and a lot of that tax advantage goes to the bank.

Psst! Wanna buy an ISA yielding 0.70% LESS than a Fixed RateBond Guv?

Dear Expert

Both the following are banks owned by Santander. This is an example. Cahoot is offering 0.7% pa more than Bradford & Bingley.

Cahoot: 2 year Fixed Rate Bond 4.20% pa matures 01/11/10

B&B: 2 year Fixed Rate Postal ISA 3.5% matures 01/11/10

There are no DIRECT charges on ISAs

Take 20% off the Cahoot Bond for tax and you get very close to B&B’s 3.50%

This has been going on for years but there has always been a “compromise” tax gap in favour of the ISA which even then is, I think, unreasonable

Could you shed some light on what I think is a Pukka general ISA rip off?

Thank you