Cash ISA are a savings account where you can earn interest tax free.

For basic tax payers investing in an ISA could increase the interest return on your savings by 20% while this figure increases to 40% for those taxed at a higher rate.

There are hundreds of cash ISA accounts available so finding an account that offers you the benefits you require should be fairly easy. Cash ISA come with a selection of options including fixed rate and instant access.

Anyone over the age of 16 can apply for cash ISA savings account. For those who oversea's that are paid by the government for example members of the armed forces can also take advantage of the tax free savings opportunities that ISAs provide.

Cash ISAs allow you invest up to £5,100 every tax year, with a tax free limit of £10,200 savings allowance. However, you are only allowed to pay your money into one Cash ISA per tax year.

Benefits of Cash ISA accounts?

• The main benefit is that you can save upto £5,100 every tax year tax free. This is particularly beneficial to higher-rate tax payers.

• ISA transfers. Investors are able to search the market for the best ISA accounts. It is possible to perform an ISA transfer to a higher yielding account.

• Building a nest egg. Many first-time buyers use them to save money for a house deposit, a dream holiday or a retirement fund.

• Access. It is possible to pay money into a cash ISA at a local bank or online. Withdrawals are also straight-forward and can be performed instantly and without penalty, provided funds haven't been locked in a fixed-rate cash ISA.

• Compound interest. Long term investors can benefit from compound interest. This can help build-up a substantial sum of tax-free savings.

Negatives of Cash ISA accounts?

• Because the cash ISA is tax free they are governed by the Inland Revenue which means that you you can only invest a maximum of £5,100 in a ax year.

• The Inland Revenue only allow you open one cash ISA account per tax year. Which means that you can't invest your tax free savings into different ISA accounts.

• Once money is withdrawn, you cannot replace it without using the remaining ISA allowance. If no allowance is available, it is necessary to wait until the next tax year before further tax-free savings become available.

• Some investors have locked-in at unfavourable rates. It isn't possible to perform an ISA transfer without incurring a penalty.

For a full list of saving accounts providers please click here. Alliance Leicester Bank Of Scotland Barclays Black Horse Egg Bank Halifax HSBC ING Direct Legal & General Lloyds TSB