Difference between placing money in a Barclays ISA and Kaupthing Edge Savings

MigsyBigsy

Dear All,

could anyone tell me what the difference is between placing money in a ISA to the Kaupthing Edge Savings?

thank you in advance for your answers...

TomsMom

An ISA is a tax free savings account. You will earn in interest whatever the rate is (6%, 6.25%, 5.8%, whatever the provider is offering) gross with no interest payable at all. You are allowed to deposit £3,600 per year into an ISA and transfer to better paying ones if you wish providing they accept transfers in.

Kaupthing Edge savings is same as any savings account, interest subject to tax if you are a tax payer. So if it is 6%, 6.5% or whatever gross, you will pay tax on the interest at 20% or 40% depending on whether or not you are in the higher tax bracket.

MigsyBigsy

thank you for the reply. The reason I ask, is that when you have an ISA you tend to leave the money in there without taking any out as that will reduce your interest earned (i think). In savings, this is also happens?

Baldur

MigsyBigsy wrote: »

thank you for the reply. The reason I ask, is that when you have an ISA you tend to leave the money in there without taking any out as that will reduce your interest earned (i think). In savings, this is also happens?

Yes, a Cash ISA is basically just a savings account, but one with a tax free 'wrapper'.

MigsyBigsy

Thank you again.

Therefore, there is no point having a ISA and a Kaupthing Edge Savings account too?

TomsMom

MigsyBigsy wrote: »

Thank you again.

Therefore, there is no point having a ISA and a Kaupthing Edge Savings account too?

Depends on how much money you've got

Fill up your ISA first, limit is £3,600 each year.

If you've any more find a savings account with the highest rate of interest.