A switch of allegiance may be the way to score with your Isa

A switch of allegiance may be the way to score with your Isa

It's now eight tax years since cash Isas were launched, and canny savers could have built up a tax-free pot of £24,000 already - plus £9,000 from previous Tessa contributions.

But as one tax year ends and another begins, don't forget that you can transfer that existing Isa money and make your savings work harder for you.

Rachel Thrussell, head of savings at moneyfacts.co.uk, says: "Unfortunately it's not as simple as looking for the best current deals, as almost all best buy rates won't accept transfers in (hence the ability to offer higher interest rates), and just under half of all Isas currently available are open for the current year's subscriptions only."

The overall best paying Isa at the moment is offered by Barclays, with a rate of 6.5% on its "Tax Beater" Isa. But it is one of the providers that will not accept transfers. The best available rate on transfers is 5.75% - on offer from both Yorkshire building society and Abbey.

If you transfer the entire eight year's worth of Isa money - £24,000 - to either of the deals, it will give you a net yearly income of £1,380. But watch out for transfer penalties, especially if your cash Isa was a fixed-rate offer.

Sadly, you can't transfer money held tax-free in equity Isas into cash Isas.

Guardian Unlimited © Guardian News and Media Limited 2006

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