Savings and investments: top five fixed cash ISAs for best returns

The letters ISA (Individual Savings Account) on dice on stacks of gold coins on a white background.

Cash ISAs are a straightforward way to squirrel away some of your income and earn tax-free interest.

They don’t return enormous amounts, but they are low-risk, secure, and can come with some flexibility to allow swift access to the money—at a cost—if you really need it.

Interest earnings are tax free up to £1,000 if you’re a basic rate income tax payers and £500 for higher rate payers. There is no tax-free allowance for additional rate payers.

The best interest rates are found if you are able and willing to tie your money up for a fixed term.

This does mean you won’t be able to withdraw cash without paying a penalty fee, but you’ll make more in interest than with an easy access ISA.

READ MORE: Top current accounts for rewards right now

If you’re not looking for large returns over a long period of time, and just want to leave a pot of savings somewhere safe for a while, then fixed cash ISAs are a great option.

Here are some of the top fixed cash ISAs with the highest interest rates right now with low or no minimum deposit requirements.

One year

Cynergy Bank 1 Year Fixed: 1.63%

Minimum deposit of £500 and a maximum of £20,000. Early withdrawals come with a penalty fee equivalent to 180 days’ interest. Apply online for an account. There's a loyalty rate of 1.64% for customers who have been with Cynergy for six months or more.

Two year

Ipswich Building Society Monthly Saver ISA (3): 2%

Minimum opening deposit of £10 and a maximum of £1,666.66 and then regular monthly payments to keep the account and its attached rate, otherwise you'll switch automatically to the instant access ISA.

The bank states: "You must make at least one payment per calendar month, which you can vary between £10 and £1666.66...You cannot make partial withdrawals.However your ISA can be closed at any time subject to a penalty equivalent to 120 days’ interest."

READ MORE: 5 great ways to save money on train fares

Three year

Metro Bank 3 Year Fixed Rate Cash ISA (7): 1.85%

A minimum deposit of £1 and a maximum of £20,000. Metro Bank says: "This account doesn’t allow you to take money out during the term. You cannot make partial withdrawals from this account. You can close or transfer the full amount before the end of the term but will lose 180 days interest."

Four year

Hodge Bank 4 Year Fixed Rate Cash ISA: 1.8%

Minimum deposit of £1,000. No early withdrawals without a penalty fee of 320 days equivalent interest. You cannot make additional deposits during the term. Accounts can be opened online.

Five year

Metro Bank 5 Year Fixed Rate Cash ISA (7): 2.1%

A minimum deposit of £1 and a maximum of £20,000. Metro Bank says: "This account doesn’t allow you to take money out during the term. You cannot make partial withdrawals from this account. You can close or transfer the full amount before the end of the term but will lose 180 days interest."

READ MORE: The best apps to get you saving money