Isas are the best way to save tax efficiently

A study has revealed that the most tax efficient way to invest in accounts with high savings interest rates is to use Isas.

According to research by F&C Asset Management, 90 per cent of survey respondents said that they use Isas as part of a tax-efficient investment portfolio.

When asked what strategies they would use to make their savings more tax efficient, 53.3 per cent said they used all or part of their Isa allowance, with a further 40 per cent claiming to use Isas and pensions.

F&C undertook the survey to mark the passing of Tax Freedom Day on May 30th, which is the first day of the year when Brits will have fulfilled their tax obligations and are earning just for themselves.

Mike Woodward, Head of Investment Trusts at F&C Investments, said: "Many people would find it a little shocking to think that every penny they earn in the first five months of the year goes straight to the Government. "

People looking for tax efficient accounts offering the best savings interest rates may want to consider the latest offering from Leeds Building Society which boasts a return of 3.7 per cent.

Moneyextra.com recommends you take independent financial advice before acting on any article

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2011-06-02 13:49:47 © Moneyextra.com