Leeds Building Society has launched a five year fixed rate ISA, paying 4.6 per cent which offers instant access to 25 per cent of the amount invested.

The mutual allows investors to transfer in all of their other ISA subscriptions from previous years, which could amount to £43,200 plus interest. The minimum investment is £1.

Kim Rebecchi, sales and marketing director at Leeds Building Society said that ISA inflows have been high this tax year.

She explained, ‘We have taken the decision to accept the additional £1,500 allowance for the over 50s. Our new 5 Year Fixed Rate ISA delivers flexibility and peace of mind.

‘With many ISAs in the market paying less than 1 per cent, investors could be missing out on at least £1,609 of tax-free interest a year which, in this current low interest rate environment, is a significant difference.’

The tax breaks on ISAs mean that the 4.6 per cent interest rate equates to 7.67 per cent for higher rate tax payers and 5.75 per cent for basic rate tax payers.

Rebecchi added, ‘There is no doubt that investors should review their existing savings and consider transferring their ISAs, to ensure they are maximising their tax free return.’

What Investment has a two part guide to ISAs in the February and March issues.