cash e-ISA

2.65% AER (2.62% tax-free) fixed until 31 October 2011 before reverting to our standard variable rate, currently 0.20% AER (0.20% tax-free)

With a cash e-ISA, you can watch your cash grow tax-free while enjoying instant access to your money. It's so simple, you can complete your account application online and manage your account by phone, electronically through Internet Banking or by post.

• start saving from just £1
• transfer any ISA balances to us, held with other providers, from previous or current tax years. (Transfers from existing first direct ISAs are not permitted).
• make the most of your ISA allowance
• immediate access to your money by internal transfer to another first direct account (transfers to accounts held elsewhere may take longer)*
• online statements
• no maximum limits on the amount that can be transferred to our cash e-ISA from another cash ISA held with another provider.

* once you have reached your ISA subscription limit for a tax year then for the remainder of that tax year it is not possible to reinvest any money you have previously withdrawn from an ISA.

How much can I subscribe to an ISA?

Because of their tax advantages ISAs are subject to annual subscription limits. The overall ISA subscription limit is currently £10,200 per tax year. Up to £5,100 of this overall limit can be saved in a cash ISA with one provider. The remainder of the £10,200 can be invested in a stocks and shares ISA with either the same or another provider. Alternatively, the full £10,200 can be invested in a stocks and shares ISA with one provider.

What is an ISA?

An ISA is a tax efficient way of saving or investing as all income and capital gains arising within an ISA are exempt from any personal liability to UK income tax and capital gains tax.

There are two types of ISA:

• stocks and shares
• cash

A payment by you into an ISA in any tax year is called a subscription. You can only subscribe to one of each type of ISA per tax year.

Please note that each year all ISA providers are required to report details of ISA subscriptions made by their customers to HM Revenue & Customs (HMRC) so that HMRC can check that individuals do not exceed the limits.

ISAs may be transferred to another ISA with the same or a different ISA provider. When an ISA is transferred in this way, the amount transferred is not a subscription and therefore does not count towards the subscription limits explained above. It is not possible to transfer a stocks and shares ISA to a cash ISA.

AER: The Annual Equivalent Rate is the notional rate which illustrates what the tax-free rate would be if interest was paid and compounded each year. Tax status of ISAs are subject to statutory change.

Tax-free: free from personal liability to any UK Income tax and Capital Gains Tax.

Tax treatment depends on individual circumstances and may be subject to change in the future.