Savings options 5 November 2022 at 12:53PM in ISAs & tax-free savings 2 replies 101 views

NicolaD

Hi all,

I have £50k which I’d like to put in a savings account for 2.5 years. This will take me to the point of my mortgage deal coming to an end and then I can pay off a chunk of my mortgage. Tax wise, am I best to invest this in a cash ISA? I can see fixed rates savings accounts pay higher interest, but don’t want to end up with a huge tax bill. Can someone please advise whats the best thing to do with it? Would it be a cash ISA? 

Thanks 

eskbanker

You can only pay up to £20K into ISAs in any tax year, but worth comparing the ISA rates with net taxable returns, and also checking out when interest would be made available to you, i.e. if it's only at maturity then you'd be receiving multiple years worth of interest but it would only be measured against one year's tax allowances.

Albermarle

Tax-free savings: check if you're eligible - Money Saving Expert