Skipton Building Society has launched a new Cash ISA, designed to encourage savers to make use of their current year tax-free allowance earlier in the financial year.
The account, which is only available for current-year ISA subscriptions, offers easy access to funds and a 4% tax-free AER interest rate. Customers can pay in up to the annual £20,000 ISA limit for 2025/26, although transfers from previous years’ ISAs are not permitted. Skipton said the launch is intended to shift the common habit of leaving ISA contributions until the end of the tax year (April 5), arguing that paying in earlier allows savers to earn tax-free interest sooner.
Alex Sitaras, head of savings and partnership products at Skipton Building Society, said: “We’re delighted to introduce the Annual Allowance Cash ISA to our range. This competitive rate gives customers a great opportunity to start benefiting from their tax-free savings now, rather than waiting until April.
“With the recent Budget announcement and planned changes in April 2027, we’re encouraging savers to make full use of their full £20,000 cash ISA allowance in the current tax year and next, before the reductions come into force in April 2027.”
In November’s Autumn Budget, Chancellor Rachel Reeves announced the annual Cash ISA allowance would be reduced from £20,000 to £12,000 for savers under 65 from April 2027. The move aims to encourage more savers to invest in stocks and shares ISAs and boost the economy.
New polling commissioned from Skipton suggests widespread concern about Ms Reeves’s proposed ISA reforms. In a survey of 563 Cash ISA holders, 67% of respondents said they reacted negatively to the changes, while 73% believe the reforms will reduce the benefits of holding a Cash ISA.
More than half of half said the move felt unfair to those who had planned around the current £20,000 cap, and 44% indicated they may rethink their savings behaviour, potentially shifting towards investments or workplace pensions.
The new ISA can be opened and managed via Skipton’s app, online, by phone, in branch or by post, and offers flexible access to savings. Interest is earned daily and added to the account the day before the anniversary of account opening.
Skipton Building Society has more than 1,300 branches and supports more than one million customers.
