Interest rate
You’ll want to lock into the highest annual equivalent rate (AER). Often the best rates are with challenger banks rather than big high-street rivals.
Our best fixed cash ISA rates
Accurate as of 12 December 2025
What is a fixed rate ISA?
A fixed rate ISA is a tax-free savings account where you get a guaranteed rate of interest for locking your money away for a set length of time.
How much can you put away: In the 2024/2025 tax year you can save up to £20,000 and earn interest tax-free.
How long is a fixed rate: Fixed rates might be for one, two, three or five years for example. In general, the longer you're prepared to lock away your money, the better your return
What happens to your savings: Once you've locked cash away in a fixed-rate cash ISA, your earnings remain shielded by a tax-free wrapper until you withdraw your deposit
How do fixed rate cash ISAs work?
In exchange for a guaranteed rate of interest, you agree to keep your savings locked away for a fixed term.
Withdrawals are not allowed until the account matures. You'll still be able to access your money by law, but the provider may require you to close the account and you may incur a penalty - meaning you may get back less than you originally deposited.
You'll need to deposit your savings within 2 to 4 weeks of opening your account, so fixed rate ISAs work best if you have a lump sum to save. For regular savings, an instant access cash ISA is better.
As announced in the budget in November 2025, the annual cash ISA limit will be £12,000 from April 2027, unless you are aged 66 or over. This will also apply to the amount of cash you can hold within a Stocks and Shares ISA.
Best fixed rate ISAs by term length
Fixed rate term | Today's best interest rate |
|---|---|
1 Year | 4.30%^ |
2 Year | 4.20%^ |
3 Year | 4.13%^ |
5 Year | 4.01%^ |
What are the pros and cons of a fixed rate ISA?
There are a range of benefits - and drawbacks - to bear in mind with fixed rate ISAs. Here are some things to consider:
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Pros
Rates may be higher than on instant access cash ISAs
Security of knowing the rate won’t change for the duration of the fixed term
Returns are tax-free
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Cons
Must lock your cash away for a fixed period – the minimum being one year
There may be a fee charged if you need your cash before the term is up
Some fixed rate ISAs will not permit you to add funds once the account has been opened. Others will not accept transfers in
Why is now a good time to open a fixed rate ISA?
Following news from the recent Budget, it makes good financial sense to look for a tax-free savings account to protect your savings.
The Bank of England also recently cut interest rates slightly from 5% to 4.75% at its latest meeting in November 2024 - the second reduction in 2024, making now a good time to lock into a relatively high interest fixed rate ISA.
A fixed rate ISA is particularly beneficial if you have a bigger savings goal and want to lock away savings to help contribute towards this, without being penalised by tax.
Fees and charges
Fixed rate ISAs (Individual Savings Accounts) may have fees for early access to your money. These can include:
Loss of interest: You may lose interest for a set period of time if you withdraw money before the fixed period is up.
Charge for early withdrawal: You may be charged the value of a set number of days' interest on the amount you withdraw. For example, some banks charge the equivalent of 90 days' tax-free interest.
Tax-free status: Any money you withdraw from your ISA will lose its tax-free status.
Different ISA providers have different rules around their penalties. It's important to be aware of any charges before you open an account.
How to best manage your fixed rate ISA account
Here are some effective ways to manage your fixed rate ISA:
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Compare fixed rate ISA accounts
Before you commit to an account, compare interest rates and check the terms and conditions to make sure it's right for your personal circumstances.
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Check your ISA allowance
The government sets a limit on the amount you can pay into your ISA each tax year. If you pay in more than the limit, the excess money will be returned to you.
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Reinvest your money
When your fixed rate ISA matures, you can reinvest your money into a new fixed rate cash ISA. You can also reinvest and add more money, or withdraw some money and reinvest the rest.
What happens at the end of the fixed rate period?
At the end of the fixed term, you will be able to get your hands on your cash. You can either withdraw your money or transfer it to another fixed-rate cash ISA.
If you want a new fixed rate for your money this is a good time to reassess the market and check you’re getting a competitive rate. You also need to decide whether to lock your money away for the same length of time, or to go for a shorter or longer term deal.
You may also decide you want to move your money into a different kind of ISA, such as an instant access ISA.
How do I access or withdraw my money?
You can't withdraw money from a fixed rate ISA before the end date, but you can close the account or transfer the balance to another ISA. Doing so before the end of the term will result in an early access charge, which is usually a percentage of the interest earned on the account. If the interest earned doesn't cover the charge, you might get back less than you paid in.
What are the rules around fixed term cash ISAs?
Fixed rate cash ISAs should be straightforward. Here’s the key information you’ll need:
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Individuals can put a maximum of £20,000 into ISAs every tax year (this is called your annual ISA allowance). You can open multiple cash ISA per tax year. If you’re just starting out, you’ll need to decide between a fixed-rate cash ISA and an easy-access cash ISA.
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While rates can be better on fixed-rate ISAs, the trade-off is you’ll need to lock your money away. If you need to withdraw your money before the fixed term has come to an end, you’re likely to face early-access penalties.
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If you want to transfer into a new cash ISA, be sure to follow the rules. Always contact the provider and fill out a transfer form. Don’t withdraw the money yourself, as your cash could lose its tax-free status.
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You can put money in to other types of ISA in any tax year – provided you don’t exceed the total £20,000 tax-free ISA allowance. You could, for example have £10,000 in a fixed rate cash ISA and £10,000 in a stocks and shares ISA.
How to choose the best fixed rate ISA for you
The best fixed rate cash ISA for you will depend on a number of factors, including:
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Duration – or term
Strike a balance between high rate and a fixed term you’re comfortable with. The longer you lock your money away, the better the rate you're likely to get.
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Access
When will you need your money? Don’t fix and lose access if you need the cash. Especially if you don't have a rainy-day fund to dip into.
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T&Cs
Read the small print – are there penalties for early withdrawal? Can you add to your ISA? It's vital to know what you're signing up for
Why look for a fixed rate ISA with MoneySuperMarket?
What other types of ISA are available?
Alternatives to a fixed rate cash ISA include:
Easy access ISA: Unlike a fixed rate ISA, easy access ISAs feature variable rates. But the key selling point is that you can access your savings easily and they're not locked up
Junior ISA: Designed for under 18s, these let you deposit up to £9,000 every tax year. Access to the money is barred until the child reaches 18
Regular saver ISA: These allow you to deposit a maximum amount per month in return for a higher interest rate.
Lifetime ISA: Targeted at people saving for their first home or retirement. Lifetime ISAs' key selling point is for every £4 you invest, the government will pay in an extra £1
Stocks and Shares ISA: Invest up to £20,000 each tax year - although higher potential returns are offset by risks that your investments could lose value.
Innovative finance ISA: A comparatively new form of ISA, innovative finance ISAs are composed of peer-to-peer loans rather than cash or stocks and shares
Our expert says…
Is a fixed rate cash ISA right for me?
A fixed-rate cash ISA is a straightforward way to save tax-free, help build up a nest egg and lock in a good rate at a time when the direction of savings rates is uncertain.
Because the rate is fixed, you’ll know the return you will get. Just make sure to shop around to get the best deal possible, and keep an eye out for when the initial fixed-rate period ends as often the interest rates can plummet afterwards.
Kara Gammell Personal Finance & Insurance Expert
How to find a fixed rate ISA with MoneySuperMarket
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Reporting savings scams
We’re aware some fraudsters are trying to use the MoneySuperMarket brand to trick consumers into handing over money or financial details, by offering fake ISA and savings products with eye-catching rates. The best way to stop these scams is to report them.
How do I report an ISA scam?
If you think you’ve been contacted by a fraudster, please stop all communication with them and report it to Action Fraud.
If it’s someone impersonating MoneySuperMarket, please contact our customer services team.
Check out our tips on how to keep you and your family safe from scams.
Am I eligible for a fixed rate ISA?
You can open a fixed rate ISA provided you are over 18 and resident in the UK. You can put away £20,000 in this tax year. You may be able to transfer funds from previous year’s ISAs, but check the terms and conditions.
How do I open a fixed rate ISA?
Compare deals with MoneySuperMarket and once you’ve made your choice, complete your application.
You can then deposit your savings into that account, and your money will earn tax-free interest until the account matures. Note that once you’ve made that initial deposit, you may only be allowed to make additions for a limited period of 14 days. After that, further additions may not be permitted.
Are fixed rate cash ISAs safe?
As with any UK cash ISA, fixed rate ISAs provided by banks and building societies are protected by the Financial Services Compensation Scheme, The FSCS covers £120,000 of savings per individual, per financial institution, should a provider go bust.
What fixed rate term should I get?
The right term for you will depend on when you think you might need to get your hands on your cash. At a time when interest rates are rising, you may want to go for a shorter fix, to ensure your ISA rate remains competitive.
What happens to a fixed rate ISA if someone dies?
If the account holder passes away before the end of the fixed rate term, it will no longer qualify as an ISA from the date of the death. Beneficiaries will only be able to access funds once the executor closes the account, or once the administration of the estate has been completed. An ISA will form part of your estate for the purposes of inheritance tax. If you have a spouse or civil partner, they can inherit your fixed rate ISA and keep the tax benefits. Your ISA will only remain open until three years and one day after your death.
Will I get a higher rate of interest on a fixed rate ISA?
In many cases, fixed rate cash ISAs offer higher rates than those on instant access cash ISAs. The interest rate is guaranteed for the length of the term. Providers are happy to pay better rates as they know how long they will have your money for. With easy access accounts, there is no such guarantee.
Can I combine older ISAs into one?
You can. And there can be real advantages for doing so. After all, with most ISAs the rate you're getting drops significantly after a year. So there's little point in keeping your money invested, when you may be able to get a better interest rate elsewhere.
Better still, it's easy to carry out an ISA transfer. And combining your ISAs into one also means less admin for you and makes it easier to keep track of your savings and how they're performing.
Do I pay income tax on the profits I make from my ISA savings?
No, you don't. In fact, perhaps the key selling point of ISAs of all kinds is that, unlike savings bonds and regular savings accounts, you don't pay income tax or capital gains tax on your profits.
That makes them an appealing way to save. And, if you've got substantial savings, they're a good way of avoid exceeding your personal tax allowance too.
Comparing savings accounts
You can compare savings accounts using a number of factors. These include the interest rates they offer as well as how long the rate will last, the amount you might need to deposit in order to open the account, and how you can access the account. Once you’ve decided which account you want, simply click through and you’ll be taken to the provider’s website.
Not sure what type of account to go for? Our Savings Decision Tree can help you decide.
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Reviewed on 11 Dec 2025 by
Accurate as of 11 December 2025.
Accurate as of 11 December 2025.
Accurate as of 11 December 2025.
Accurate as of 11 December 2025.