Rachel Thrussell of Moneyfacts comments, "The last few weeks have seen the banks and building societies upping their game as the new tax year approaches. Last year's best buys were dominated by rates up to a maximum of 6.05%. However, in what has become a far more competitive environment this year, all the best buy rates are paying 6.10% and above."

Should you transfer existing cash ISA holdings?

Most of the best buy accounts will accept transfers in although Barclays Bank, which is offering a market-leading 6.50% gross on its Tax Haven ISA, won't. Anyone with existing cash ISA balances may wish to consider switching to the likes of Abbey's Direct ISA Issue 2 or Alliance & Leicester's Direct ISA Issue 4, both of which are paying 6.25% gross, or Scarborough Building Society's 30-day notice ISA which is offering 6.30% gross

Adds Rachel Thrussell, "Consumers could potentially have saved £27,000 in tax-free savings since ISAs began in 1999, or £36,000 including previous Tessa-only ISA monies. Transferring to an account paying just 0.1% higher interest could make a big difference."

Remember if you are considering transferring a cash ISA balance, you must make sure the transfer is carried out properly - don't attempt to do it yourself by withdrawing your ISA funds from your existing provider, you could lose the tax-free status of your savings if you do.

The most attractive rates are being offered on specially packaged ISAs. But such attractive-looking rates usually come with conditions attached. Abbey's Super ISA Issue 2 pays 10% but you need to invest an equal amount in the bank's Guaranteed Growth Plan at the same time and the rate on offer reverts to the Direct ISA Issue 2 rate after 13 months. Alliance & Leicester is also offering 10% on its Premier ISA Issue 2 but you are required to have a Premier current account, pay in at least £500 a month to the current account and open an investment product with at least £5,000 at the same time.