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Leeds BS launches cash ISA paying 1.46 per cent

Emma Lunn
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Emma Lunn

Leeds Building Society has launched a cash ISA that has gone straight to the top of the best buy tables.

The instant access cash ISA pays 1.46 per cent AER. It can be opened with a minimum balance of £1,000 and accepts transfers in from previous years’ ISA subscriptions from both cash and stocks and shares ISAs.

Leeds Building Society instant access ISA can only be opened and operated online, and interest is paid on maturity on 30 November 2020. Interest can be credited to the account or paid to another account with the society or elsewhere.

Leeds’ table-topping interest rate is the same as Coventry Building Society’s limited edition ISA. However, Coventry’s rate includes a bonus of 0.31 per cent bonus until 31 January 2021 – after that the rate will fall to 1.15 per cent.

Coventry’s ISA also only allows three penalty-free withdrawals each year with further withdrawals subject to 50 days’ loss of interest. Leeds’ ISA has no such withdrawal restrictions.

The Leeds Building Society ISA also beats the best rates in the mainstream easy access savings market. Coventry Building Society’s easy access savings account pays 1.46 per cent but includes a 0.31 per cent bonus until March 2021. The previous best buy account from Marcus (from Goldman Sachs) pays 1.45 per cent.

Matt Bartle, Leeds Building Society’s director of products, said: “As well as offering a market-leading rate, our new Limited Issue Online Access ISA offers true instant access, with no restrictions on the number or frequency of withdrawals.

“The mid-point of the financial year in October is a good time for savers to review their arrangements and can prompt them to check they’re maximising the value of their ISA subscription to ensure returns from their savings are tax free. Right now, savers still have six months of the current financial year to benefit by opening or making deposits into an ISA.

“At Leeds Building Society we continue to see consistent demand for our ISA range, despite industry speculation that the introduction of the Personal Savings Allowance had made this type of account less relevant.

“That’s not our experience and we believe there’s still a place for ISAs, as part of holistic financial planning and a way to ensure tax-free interest is maximised in the longer term.”