i looked at the principality dave but there is no withdrawal/transfer out option so you really are fixed for 3 years .. which imho is too long. at least with the bm fixed bond you can get at your cash albeit with a 90 day interest penalty. as i am currently a non-taxpayer i still prefer the bm option but thanks for your suggestions.

If you transfer your ISA to another provider you can more than match the 3 year 4.65% (taxable) bond; eg Principality 3 year ISA fixed at 4.2% (equivalent to 5.25% before tax) or M&S MONEY 3 YR ISA at 4% (equiv to 5%) - that way you still keep the tax free status.

I agree. The banks are eating up all the tax advantages that the government gives us. Cash ISAs are a complete waste of time.

It is hard to believe that the government doesn't see what is going on. Does the government allow it as a secret, hidden subsidy to the bankers? Stealing from the poor to give to the rich you could say.

On top of all the tax and quantitative easing (printing money) that we give them...

I am in the same position. Like you, I keep my ISAs in the belief that I will get tax advantages some day. But for now they are a joke. Time for an expose...

b`ham midshires have advised me that my isa is about to mature so i will no longer be getting interest at 6.15%. however they have generously offered me the opportunity to transfer the proceeds into a "direct isa" paying me 1.5% or a 1 year fix at 2.5%. wow - hold the front page !! i already have an instant phone extra a/c with them paying 3.15% and i can open a 3 yr bond paying 4.65% with a 90 day notice penalty. so, what is the point of them offering isa`s really ?????? seems to me im better off just paying the tax and moving my savings about to get the best rates, even if i sustain a w/d penalty at times.

as it happens im a non-taxpayer at present but i did want to keep my savings tax sheltered because, hopefully, my situation will change in the future. im damn sure the chancellor didnt intend that the banks offer lower rates on their isas than on instant cash accounts - even sainsburys are offering 3.2% for an online instant account !!