What is a Cash ISA and how does one work?

A Cash ISA (Individual Savings Account) is a type of savings account that lets you earn tax-free interest on the money you save. With a Cash ISA, you can earn interest annually (paid out once a year) or monthly. You have a choice of a Fixed Rate ISA, which has a consistent interest rate for a set amount of time, or a Variable Rate ISA, where the interest rate can change.

A Cash ISA has rules on how often you can make withdrawals. You may not be able to withdraw any money during the ISA term, you might be able to withdraw a certain number of times, or you might be able to take money out as many times as you like.

How to apply for a Cash ISA

To get a Cash ISA with YBS, you’ll need to meet the eligibility criteria. For example:

  • You’ll need to be aged 16 or over.
  • You must be a UK resident for tax purposes. Crown employees, or those married or in a civil partnership with a Crown employee, may also qualify.
  • Your Cash ISA must be held in your name only.
You can transfer your existing ISA savings from previous years into your Fixed or Variable Rate ISA, though you can only subscribe to one Cash ISA in a single year. Find out more about ISA transfers. 

Once you’re ready, you can apply online through the YBS website, in a branch, or by calling 0345 1200 200* to request an application pack. After your Cash ISA is set up, you can manage the account online, giving you a simple way to make transactions and check your balance and interest rate.

What is a Fixed Rate Cash ISA?

A Fixed Rate Cash ISA has an interest rate which won’t change during the term of the account, as long as the account terms and conditions are followed.

This may mean that you can’t make any withdrawals until the term of your Cash ISA ends, or risk losing your tax free status.

Early closure of a Fixed Rate Cash ISA will mean a loss of tax free status and a loss of interest. You might be able to transfer a Fixed Rate Cash ISA without losing tax free status.

What is a Variable Rate Cash ISA?

A Variable Rate Cash ISA has an interest rate which can change. The interest rate you are offered can go up or down depending on your balance. You won’t pay tax on any interest earned.

You may be able to make more regular withdrawals from a Variable Rate Cash ISA, compared to a Fixed Rate Cash ISA (which may not allow you to take any money out during its term).

Frequently asked questions

The total annual ISA allowance is
£20,000
for the
2023/24
tax year. Money you deposit into an ISA will be counted as part of your yearly allowance, unless you are replacing money you have previously withdrawn from a flexible ISA in the same tax year.


If unused, your allowance limit doesn’t carry over to the next tax year and is lost. If you already have money deposited into an ISA in a previous tax year and want to move it to a new ISA, that doesn’t count towards your allowance for the current tax year.

No, you can’t save into more than one Cash ISAs in a tax year.

You can save into one Cash ISA and other types of ISAs not provided by YBS e.g. Stocks & Shares. You can also transfer your money between ISA accounts, including those not offered by YBS, subject to the product terms and conditions.

While your money is in a YBS Cash ISA it is secure. Eligible deposits with Yorkshire Building Society are protected up to a total of £85,000 by the Financial Services Compensation Scheme, the UK's deposit guarantee scheme.

Yes, you can transfer an ISA to YBS from another provider*. Find out more about ISA transfers

*Withdrawals from some Cash ISA accounts are restricted and this may affect the time it takes to process your transfer and/or could result in charges being incurred.

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Your eligible deposits with Yorkshire Building Society are protected up to a total of £85,000 by the Financial Services Compensation Scheme, the UK's deposit guarantee scheme.