Savings guides

• Earn up to 3.09% AER (variable) includes a bonus of 1.00% Gross p.a. (fixed) for 12 months added to the standard variable interest rate when you save over £30,000 in your e-ISA
• Save up to £5,340 tax free – in the tax year 2011/2012
• No withdrawal penalties – take money out whenever you want. Remember, you can only save up to £5,340 this tax year. If you take money out, you'll not be able to pay any money back in if you've already paid in the maximum cash ISA allowance that tax year.
• Monthly tax-free interest – calculated daily and paid monthly on the last business day directly into your account
• Get the savings habit – we can set up a regular transfer from your other NatWest account
• Manage your NatWest e-ISA online – we’re open 24 hours
• Set up and track your personal saving goal – with Online Banking

Tax free interest means interest payable is exempt from UK income tax.

• Are there any penalties?
• Can I transfer money in from more than one bank or building society?
• I’ve paid £1,000 of my current tax year allowance into a cash ISA with another provider. Can I open a NatWest cash ISA and pay in the remaining £4,340?
• Do I need to send a cheque for my initial deposit and who should I make it payable to?
• What should I enter in the initial deposit section if I’ve already fully subscribed my tax-free allowance for the year?
• I’m registered with Online Banking, how do I check what my cash ISA limit is?

Q. Are there any penalties?

A. No. You can withdraw your money or close your account at any time. We’ll simply pay interest on the daily cleared balance. Remember if you withdraw money you’ll not be able to pay any money back in if you’ve already paid in the maximum cash ISA allowance that tax year.

Q. Can I transfer money in from more than one cash ISA?

A. Yes. Simply fill out an ISA transfer form (PDF, 53KB) for each cash ISA you want to transfer.

Q. I’ve paid £1,000 of my current tax year allowance into a cash ISA with another provider. Can I open a NatWest cash ISA and pay in the remaining £4,340?

A. No, you can’t pay into more than one cash ISA in a tax year. However, you can pay the remainder of your annual allowance into your existing cash ISA with the other provider and then transfer it over to us.

Q. Do I need to send a cheque for my initial deposit and who should I make it payable to?

A. No, once your account has been opened we’ll write to you with instructions on how to make a deposit.

Q. What should I enter in the initial deposit section if I’ve already fully subscribed my tax-free allowance for the year?

A. Key in £1 initial deposit, select payment method cheque/cash and click that you do not wish to make regular savings. This will let you move through the screens. By enclosing the transfer form with your application we will be aware that you do not wish to deposit £1 therefore you will not be oversubscribing to your cash ISA.

Q. I’m registered with Online Banking, how do I check what my cash ISA limit is?

A. You can check how much you can pay/have paid in to your cash ISA account on the 'View Account Details' screen.

You can access that screen by selecting your cash ISA account on the 'Accounts Summary' and then selecting the 'View Account Details' button, near the bottom of the screen.

If you have not used any of your cash ISA allowance for the tax year, it will show the 'Deposits allowed this year'.

If you have used some, but not all, of your cash ISA allowance for the tax year, it will show the 'Deposits allowed this year' and 'Deposits so far this year'.

If you have used all of your cash ISA allowance for the tax year, it will show the 'Deposits so far this year'.

An ISA is a tax efficient way to save. It stands for Individual Savings Account. With an ISA you pay little or no tax on the interest your savings and investments make.

There are two types of ISA:

• Cash ISAs — are tax-free. Interest payable is exempt from UK income tax. NatWest e-ISA is a type of cash ISA
• Stocks and shares ISAs – are tax efficient. They are a medium to long term investment so they should be held for at least five years. With stocks and shares ISAs, the value of your investment and any income you receive can go down as well as up and you may not get back your original investment.

Paying money into an ISA is called a subscription. You can subscribe to one cash ISA and one stocks and shares ISA in every tax year, and there’s a maximum amount you can pay into each one.

With some cash ISAs – such as the NatWest e-ISA − you have instant access to your money, so it can be a flexible way to plan your finances. Some cash ISAs have penalties for withdrawals where an interest charge applies if you access your funds early.

It’s important to remember that ISA allowance limits apply to everyone on an individual basis. If you’re married or in a relationship, you can both have an ISA, each with the full allowance.

To subscribe to an ISA:

• You must be aged 16 or over, or 18 or over to hold a stocks and shares ISA.
• You must be a resident and ordinarily resident in the UK
• You can subscribe to one cash ISA and one stocks and shares ISA in a tax year, but there are limits to how much you can save in each ISA.

There’s a yearly limit on the amount you can put in to an ISA. For the 2011/12 tax year the limit is £10,680. You can use this allowance in a variety of ways. You can:

Save up to £5,340 in a cash ISA
or
Save up to £10,680 in a stocks and shares ISA
or
Save up to £5,340 in a cash ISA and put the remainder of the £10,680 allowance into a stocks and shares ISA

If you put less than the full allowance into a cash ISA, you can use the rest of that limit to add into your stocks and shares ISA limit. For example, if you only choose to put £2,000 into a NatWest e-ISA, you can put up to £8,680 into a stocks and shares ISA.

If you withdraw money from your ISA, you can’t reinvest it in the same tax year if your total deposits will exceed your yearly allowance.

Using the e-ISA as an example:

There are two types of cash ISA:

• Variable Rate ISAs – where the interest rate can move up and down. They normally give you instant access to your money or a short notice period.
• Fixed Rate ISAs - where the interest rate is fixed for a period of time, and conditions often apply if you want to withdraw your money early

Your choice of stocks and shares ISA

You can choose from three types of stocks and shares ISA:

• Self-Select ISAs, where you choose what you want to invest in
• Actively Managed ISAs, where a team of experts manage your investments for you
• Passively Managed ISAs, (also known as tracker ISAs) where your money is invested so that it tracks a particular market or index, such as the FTSE 100.

With stocks and shares ISAs, the value of your investment and any income you may receive can go down as well as up and you may not get back your original investment.

Making future subscriptions

You can subscribe to a fixed rate cash ISA for a single tax year, but it can be fixed for a longer term, sometimes up to five years. In the next tax year, you can then open a new cash ISA which can either be fixed rate or variable rate.

You can keep a variable rate cash ISA and a stocks and shares ISA open year after year, paying into them in subsequent tax-years, up to your yearly allowance. However, if an entire tax-year goes by without a deposit being made into your cash ISA, you cannot make any further payments into it until you have reactivated your account.

How to reactivate your cash ISA

To reactivate your cash ISA, you simply need to complete a reactivation form.

• Reactivate an old NatWest cash ISA

Transferring an ISA

You can only open one cash and one stocks and shares ISA each tax year. If you want to move your current or previous cash ISA balances between providers, you can, without losing your tax-free entitlement.

Some cash ISA transfers can take up to 15 working days to process. Your new ISA provider will start to pay your interest from day 16 if the transfer process is not complete within this period. This lets you start earning interest from your new cash ISA account faster.

Don't forget to make sure that your new cash ISA provider allows transfers in, and that you open your new account in advance. It is possible to transfer your cash ISA balances into a stocks and shares ISA, however it is not possible to transfer stocks and shares ISA balances into a cash ISA.

There are a number of important factors which need to be considered before transferring a stocks & shares ISA. For more information on stocks & shares ISAs take a look at Tax efficient investments.

If you already subscribe to an ISA, you can continue saving in your existing ISA in the new tax year, or you can open a new ISA.

You can subscribe to one cash ISA and one stocks and shares ISA in a tax year. Don’t forget, the tax year ends on 5 April – make sure you take advantage of this year's allowance before it’s too late.

Setting up a new NatWest e-ISA is simple and you can apply online. You’ll need the following information to set up an e-ISA:

• Your National Insurance number
• One form of evidence of your identity – such as a current passport, full UK driving licence, a benefit book or UK armed forces identity card
• One form of evidence of your address – such as an original gas, electricity, phone or council tax bill, an original bank or building society statement

All documents should be the most recent you have, and no more than six months old.

• Apply online for a NatWest e-ISA
• View our range of ISAs