ISA’s at Lloyds TSB

ISA’s at Lloyds TSB March 16

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There are currently two types of ISA’s available from Lloyds TSB: the mini cash ISA, and the fixed rate mini cash ISA. As both are cash mini ISA’s, this means that only up to £3,000 can be invested in either account in any tax year. Lloyds TSB also provides a Tessa ISA, while Lloyds TSB maxi ISA’s are available in conjunction with Scottish Widow. The main benefit of holding savings in an ISA is that they are then exempt from tax.

Lloyds TSB mini cash ISA

The Lloyds TSB mini cash ISA can only be opened with an investment of £10 or above. However, the more money invested, the greater the interest rate. Account balances of more than £10 qualify for a rate of 4 per cent AER, and a 4.85 per cent AER rate is secured for investments more than £3,000 (this, then, could only apply in the second tax year at the earliest). Sustained investment could see the interest rate reach 5.25 per cent AER if the account holds £21,000 or more.
Withdrawals do not carry a penalty, although they must be made either to a bank account - in which case funds will be cleared after three working days - or will be sent by cheque to a postal address - which takes five working days. Requests for withdrawals must be made by post.

Lloyds TSB fixed rate mini cash ISA

The Lloyds TSB fixed rate mini cash ISA offers a fixed interest rate of 3.7 per cent AER in the first year, although a bonus rate of 1.85 per cent is applicable if no withdrawals are made for the full investment period. However, the minimum opening deposit is £3,000, and after 12 months the account reverts to a regular mini cash ISA. Interest is calculated on a daily basis and paid into the account at the end of the year.

Lloyds TSB Tessa ISA

The Lloyds TSB Tessa ISA is available to existing Tessa ISA holders. The interest rate tier system works in exactly the same way as the mini cash ISA - investments of more than £10 secure rates of 4 per cent AER and the interest rate increases up to the 5.25 per cent AER offered for accounts holding more than £21,000 depending on how much is invested. The withdrawal system is also identical to that available to mini cash ISA.

Written Exclusively by AdFero for ISA Guides

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