Cash ISA

Summary box

Account Name

Cash ISA

What is the interest rate?

Current Rate

Balance	Interest rate
All balances	2.40% AER (2.37% tax-free)

Interest is variable, calculated daily and credited monthly.

Can first direct change the interest rate?

Yes. The account pays a variable rate of interest, which means it can change over time. The first direct cash ISA Terms and Conditions explain when and how we do this. For example, we might review the interest rate if the Bank of England base rate changes.

What would the estimated balance be after 12 months based on a £1,000 deposit?

Initial deposit	Interest rate	Balance at end of 12 months
£1,000	2.40% AER (2.37% tax-free)	£1,024.00

For the purpose of this calculation it is assumed:-

initial deposit of £1,000
no additional deposits
no withdrawals
the interest rate remains the same during the 12 months

Projection provided for illustrative purposes only and does not take into account individual circumstances.

How do I open & manage my account?

Eligibility:

you must hold a first direct 1st Account, our current account
be aged 18 years or over
You must provide your National Insurance Number if you’re eligible to hold one
in addition, in order to subscribe you need to be resident in the UK for tax purposes, or if not so resident, be a UK Crown employee serving overseas, or be married to, or in a civil partnership with, such a person

How to open the account:

this account can only be opened in a sole name
open an account via Online Banking, or by post
or you can transfer current and/or previous tax years' subscriptions by completing an ISA transfer form

Minimum/Maximum Balance:

a minimum of £1 must be deposited to open the account
The overall ISA subscription limit is £20,000 for the current tax year, within this the Lifetime ISA has it's own annual payment limit (currently £4,000). You can only subscribe to one type of cash ISA and one type of stocks and shares ISA in the same tax year across HSBC and first direct
no maximum balance

How to manage the account:

once opened you can manage your account via Online Banking, through our App or by phone

Can I withdraw money?

Yes, you have instant access to your account. You can make as many fee free withdrawals as you like. However, any amount you have paid into your ISA will count towards your annual ISA subscription limit even if you later withdraw it.

If you withdraw funds from your ISA you will lose the associated future tax benefits.

Additional Information

a 30-day cancellation period applies to this account
You can check your eligibility and apply at GOV.UK > Money and Tax > National Insurance
interest is paid tax-free, that means it is paid free from UK Income Tax and Capital Gains Tax
the value of tax benefits provided by a cash ISA depend on your personal circumstances and tax rules may change in the future

Definitions

AER stands for Annual Equivalent Rate. This shows you what the gross rate would be if interest were paid and compounded each year
ISA stands for Individual Savings Account

Information correct as of 06 April 2025

Before you apply

Transferring ISAs

ISAs can be transferred to another ISA, either with the same provider or someone new (but remember not all cash ISAs accept transfers in and some providers may charge for transferring an ISA out). Here's what you need to know:

when an ISA is transferred, any amount transferred from previous years' allowances aren't counted in that year's allowance
previous years' allowances do not need to be transferred in full, they can be split between different providers
you can transfer cash or stocks and shares ISA balances to us, held with other providers, from previous or current tax years
however any amount being transferred from the current tax year must be transferred as a whole and will count towards that year's allowance
when transferring a stocks and shares ISA, your stocks and shares ISA manager will, after receiving the instruction to transfer, sell your shares and make the transfer in cash - and this could mean a loss of income or interest whilst the transfer is being made.

Cash ISA Transfer Request Form (PDF)

Reactivating your ISA

If you already have a Cash ISA, but haven't subscribed to it in the last tax year, you won't be able to subscribe in the current tax year unless you reactivate it. To reactivate your ISA and make further subscriptions, please download the Cash ISA reactivation form (PDF).

Important documents

Cash ISA Terms and Conditions (PDF)
Privacy Notice (PDF)
Interest Rate and Charges (PDF) (For 1st Account charges refer to Account Terms and Conditions and Charges)
UK Financial Services Compensation Scheme Information Sheet and Exclusions List (PDF)
Cash ISA Application and Reactivation Form (PDF)
Cash ISA Transfer Request Form (PDF)
Cash ISA Standing Order Form (PDF)
Cash ISA Transfer Guidelines (PDF)

How are ISAs changing from the 2025/26 tax year?

National Insurance number eligibility changes

From 6 April 2025, when you apply for a first direct ISA:

if you tell us you have a National Insurance number, you must provide it as part of the application process (you’ll not be able to continue with your application if you don’t)
if you tell us that you don’t have a National Insurance number, we’ll ask you if you’re eligible for one
if you’re eligible for a National Insurance number and you don’t have one, you’ll need to apply for one from the Government before you can continue with your ISA application
if you’re not eligible for a National Insurance number, you must declare this as part of your ISA application.

Where can I find my National Insurance number?

You’ll find your National Insurance number on:

your online personal tax account
HMRC app
documents such as your payslip, P45 or P60.

How do I check if I’m eligible for a National Insurance number?

You can check if you’re eligible for a National Insurance number and apply online at GOV.UK > Money and Tax > National Insurance> Find your National Insurance number online.

How long does it take to get a National Insurance number?

Government guidance states it can take up to 4 weeks to receive your National Insurance number once you’ve applied.

Why do I need to apply for a National Insurance number if I’m eligible?

The government has confirmed that from 6 April 2025, new ISA accounts must contain your National Insurance number, unless you’re ineligible to have one. This has changed from previous ISA requirements, where we could rely on your declaration that you didn’t have one.

To meet this new requirement, from 6 April 2025 we’ll now ask if you’re eligible for a National Insurance number when you apply for an ISA, to transfer an ISA to us, or to restart subscriptions to an existing ISA.

How can I find out more about these changes?

You can read more about these changes at GOV.UK > Money > Personal tax > Tax on savings and investments > Tax-free savings newsletter 14.

How did ISAs change in the 2024/25 tax year?

What changes to the ISA regulations applied to the first direct cash ISA from 6 April 2024?

The following changes to ISA regulations came into effect in April 2024, for the 2024/25 tax year:

Mandatory change:

Increase of age eligibility: To open a new cash ISA, customers need to be either:

aged 18+
OR covered by the transitional arrangements, customers must be aged 16 or 17 (as of the 5 April 2024) in place until 5 April 2026.

first direct will not allow customers under 18 to open a new cash ISA from 6 April 2024 but will consider this in the future.

Optional changes:

Note: Individual ISA providers aren’t obliged to make the following changes. However, all ISA providers are required to update application forms/declarations from 6 April 2024 to reflect any changes they do make.

customers can subscribe to multiple ISAs of the same type in each tax year but they must remain within the overall annual subscription limit across all ISAs held. The exception to this is subscriptions to a Lifetime ISA (which we don’t offer) and to customers under 18 subscribing to a cash ISA
customers can make partial transfers of current tax years’ subscriptions
customers can restart subscriptions to an ISA they haven’t made subscriptions to in the previous tax year without having to complete an application form. NOTE: This doesn’t apply to ISA products where an application form is required every tax year before subscribing.

What changes did first direct make and why?

We were already complying with the mandatory change announced by HMRC, increasing the minimum age for opening cash ISAs from 16 to 18 years old. We only offer cash ISAs to customers over 18 years old.

From 6 April 2024, customers aged 16 or 17 covered by the transitional arrangements can subscribe to a cash ISA but, up until they turn 18, they can’t subscribe to more than one cash ISA in the same tax year. This was an optional change, which we didn’t make.

Did first direct implement all the changes HMRC announced?

No, we didn’t implement the optional changes.

What changes did other providers make?

As some of the changes are optional, individual providers may be approaching the changes differently.

Are customers aged under 18 still able to apply for a first direct Cash ISA before the new tax year?

From 6 April 2024, customers under the age of 18 still won’t be able to apply for a first direct Cash ISA.

At a glance

All things tax

Who can apply?