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Two new best buy savings deals launched by Castle Trust Bank

Choice of two: Those with larger pots of savings can consider Castle Trust's one-year fixed rate cash Isa, which pays a market-leading 3.15%

A new Best Buy savings offer has launched, allowing savers to earn a yield of 3.47% at the one-year fix.

Castle Trust Bank is offering the deal, which now tops the independent table of one-year fixed rate bonds This is Money best buy, having topped those launched last week by BLME and Charter Savings Bank – both paying 3.4% .

Someone who hides £20,000 in the Castle Trust account can expect to earn £694 in interest after one year.

Choice of two: Those with larger pots of savings can consider Castle Trust's one-year fixed rate cash Isa, which pays a market-leading 3.15%

Choice of two: Those with larger pots of savings can consider Castle Trust’s one-year fixed rate cash Isa, which pays a market-leading 3.15%

The fixed rate account can only be opened and managed online, with interest paid at the end of the 12 month period.

All deposits are protected by the Financial Services Compensation Scheme, up to £85,000 per person.

Savers will need to deposit a minimum of £1,000 to start and can save up to a maximum of £500,000 in the account.

What is Castle Trust Bank?

Castle Trust was founded in 2012 and is backed by US private equity giant, JC Flowers & Co.

She applied for her banking license in 2018 and obtained full authorization in June 2020. She published her first savings offers last year, with all her accounts protected by the FSCS.

The bank, based in Basingstoke, operates without branches. It uses savings deposits to fund lending operations.

It primarily provides mortgage loans to experienced buy-to-let investors and high net worth individuals, as well as corporate loans.

He says his mortgages and loans are often given to those with high-quality assets but unconventional incomes.

It gets scores respectively in terms of online ratings, but with only a small number of reviews. It scores 3.9 out of 5 on Google reviews, 3.4 out of 5 on Trustpilot.

Account type (minimum investment) 0% tax 20% tax 40% tax
Castle Trust Bank (over £1,000) 3.47 2.78 2.08
BLME (£1,000+) 3.40 2.72 2.04
Chartered Savings Bank (£5,000+) 3.40 2.72 2.04
Close Brothers (10,000+) 3.32 2.66 1.99
Oaknorth Bank (£1+) 3.32 2.66 1.99
Virgin Money (£1+) 3.32 2.66 1.99

New Best Buy Cash Isa Transaction Alert

Those with larger pots of savings may want to consider Castle Trust’s one-year fixed rate cash Isa.

This 3.15 percent is currently the market leader and will allow savers to protect any interest they earn from the taxman.

This is because any interest saver who exceeds the personal savings allowance (£1,000 for base rate taxpayers and £500 for higher rate taxpayers) will be taxed each year.

Over a year paying 3.47%, a basic rate taxpayer would need almost £29,000 saved to exceed their personal allowance, while a higher rate taxpayer would need almost £14,500 to exceed their limit.

Once interest begins to be taxed at a rate of 3.47%, a base rate taxpayer will effectively earn 2.78% after tax, while a higher rate taxpayer will effectively earn 2.08% after tax. .

Sean McCann, Certified Financial Planner at NFU Mutual, said: “After years of low interest rates, savers finally enjoying better returns could be stung by an unwanted tax bill.”

“With 3.5% available on fixed rate savings, some higher rate taxpayers need less than £15,000 in savings to trigger a tax bill.

“In times of high inflation, every pound counts and no one wants to pay tax on their savings.

“Many people are better off moving some of their savings into an Isa, where the interest they receive is tax-free.

“With inflation rampant, those looking for real money growth and willing to take more risk with their investments should consider investing in Isa stocks and shares which offer the potential to beat inflation at longer term.”

The Isa cash transaction from Castle Trust Bank must be opened and handled online, with a minimum of £1000 required to open the account. It accepts transfers in.

As with the fixed rate bond, savers cannot withdraw their money without incurring any fees at the end of the 12 month period.

The second best one-year deal is offered by Santander and pays 3%.

Currently, inflation is at 9.9%, and no account currently comes close to that.

Meanwhile, the base rate is at 1.75% after a number of hikes since December, which has been the catalyst for improved savings offers.

However, another rate hike is expected on Thursday, with forecasters expecting it to be 0.5 or 0.75 percentage points, which could lead to increased savings offers in the coming months. .

Some links in this article may be affiliate links. If you click on it, we may earn a small commission. This helps us fund This Is Money and keep it free to use. We do not write articles to promote products. We do not allow any business relationship to affect our editorial independence.

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