Our savings picks: This is Money's five favourite best buy cash Isas for 2016

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Every little helps: Savings rates might be low but at least an Isa means interest is tax-free

Our savings correspondent Lee Boyce picks his five favourite cash Isas for savers in 2016 - essential reading to help you choose a top savings account for your money.

This page is kept up-to-date throughout the year - bookmark it for the very latest developments.

How an Isa works and why you should have one

Each year in April, savers are given a fresh Isa allowance that qualifies for tax-free interest.

For the 2016-17 financial year - which began on 6 April 2016 - the limit is set at £15,240, all of which can now go into a cash Isa.

In the 2017-18 financial years, which begins on 6 April 2017, the limit will increase to £20,000.

You can transfer Isa money whichever way you wish between an investment account to savings account, whereas previously you could only shift it from saving to investments.

Although cash Isas don't currently offer fantastic rates, it is still worthwhile opening one to shield money away from the taxman.   

Isa rules state you can only contribute to one Isa per tax year.

You can also transfer an old Isa for better returns. Here's a quick guide to Isa saving.

It is possible to switch your current year's cash Isa if you move the entire amount, but it is far simpler to get your choice right in the first place.

Rates are low and that makes the best Isa more important

Banks and building societies should be apologising to savers for the slim pickings on offer here.

Savings rates really are dire at the moment and unfortunately, institutions are doing little to shelter savers from the assault of the low interest rate environment.

The recent cut to 0.25 per cent for the base rate, launch of a new funding scheme to pump cheap money to banks, and expansion of quantitative easing, has made things even worse. 

Many now ask themselves why bother?

Yet when rates are low it becomes even more important to make sure you are getting as much as you can from your savings. 

We also think an Isa is still worth having, despite the new tax-free savings interest allowance of £1,000 a year for basic rate taxpayers and £500 for higher rate taxpayers. 

It's tough to get that much interest now, but one day rates will rise. Money sheltered in an Isa will deliver a tax-free income, even above that £1,000 level and if you are building up a long-term pot, you may one day be very grateful for that.

HOW WE PICK OUR FAVOURITE FIVE ISAS

Lee Boyce: This is Money's savings expert

Our five favourite Isas round-up is a permanent feature of This is Money.

It comes complete with an explanation detailing why we're happy to pick each account.

This page will be kept updated as and when new deals pop up or old ones get scrapped.

Our team work tirelessly to stay on top of the latest rate changes, but banks and building societies can pull deals without telling us. 

If you spot a deal here that is not longer available please email us at editor@thisismoney.co.uk

Remember, you can open an Isa or transfer (provided you're not tied to a fixed-term) at any time during the year.

Note that we don't just copy the best rates from the savings tables - we scour the market for all-around winners. 

This is a taster of the top deals. For the best rates, visit our savings rates tables, which are comprehensive and independently compiled.

Our five favourite Isas:  

Coventry BS, easy access, 1.1% [Full details] 

- Facts: £1 to open

- Transfers in: No

- This is Money says: This easy-access account is the top rate available without strict access terms. It is a variable rate and could change in the near future, so you will need to keep an eye on it. It also doesn't allow transfers in. 

AA Savings, easy access, 1.05% [Full details] 

- Facts: £100 to open

- Transfers in: Yes

- This is Money says: This easy-access deal offers a slightly lower rate than the Coventry BS deal above, but allows transfers in. It includes a 0.85 per cent bonus for the first year, so you will need to switch in 12 months time to a better deal.  

Shawbrook, two-year fix, 1.2% [Full details] 

- Facts: £5,000 to open

- Transfers in: Yes

- This is Money says: This is the best rate currently on offer over two years and also allows transfers in. Interest can be paid monthly or annually. 

Paragon, three-year fix, 1.5% [Full details] 

- Facts: £500 to open

- Transfers in: Yes

- This is Money says: This is the top three-year rate available and allows transfers in. It can only be opened online and interest can be paid monthly or annually.

Shawbrook, five-year fix, 1.7% [Full details] 

- Facts: £5,000 to open

- Transfers in: Yes

- This is Money says: This is the best rate you can currently obtain on an Isa, but you will have to fix for five years to get it. 

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