Unlikely names now offering the highest fixed Isa rates? The big High Street banks! SYLVIA MORRIS

For the first time in years, the big banks are paying top rates on fixed-rate ISAs. And I’m surprised to see them pushing into the best buy tables on tax-free accounts.

But as usual, there is a sticking point. You can’t get their tempting rates if you’ve already opened a cash Isa with them this tax year.

That’s because they still operate under outdated rules that restricted savers to holding just one cash Isa in any given tax year.

The rules changed on 6 April, allowing savers to spread the £20,000 Isa exemption across as many cash Isas as they like, with as many providers as they like.

But try opening two or more with a major bank such as Barclays, HSBC, Lloyds, Halifax, NatWest or Santander and you’ll hit a wall.

It wouldn’t matter if the big banks’ rates were as bad as usual. But they are among the most competitive on one-year fixed rate deals.

For example, Santander is paying 4.62 percent until September 1 next year, while Barclays is offering 4.55 percent.

Five months after the new rules came into effect, these banks have still not passed on the benefits to savers.

Not all of us have £20,000 to put into a tax-free cash Isa when we get our annual allowance at the start of a new tax year. Instead, we add to it in a trickle as we can.

View the best cash Isa interest rates in our savings tables

This flexibility should be a huge boost. For example, we can now open an Isa at the start of the year with all the money we have available and then later convert a fixed rate bond into another Isa when it matures.

The only condition is that we do not exceed the £20,000 annual allowance. But we are surprised by the slow acceptance of banks to offer this new twist.

Money Mail reader Ann Wicks transferred £4,500 from a non-ISA easy access account into a fixed rate NatWest ISA this tax year.

Now she wants to add money to her Isa savings account, but this specific account has been withdrawn.

The fixed rate of 4.5 per cent the bank offers is out of reach for her – because it only allows you to open one cash Isa per year and would count as a second. Instead, she has to open an account with another provider.

Two-thirds of the 15 largest providers are struggling with the new rule, including building societies in Yorkshire, Coventry and Leeds, and Shawbrook Bank.

Skipton Building Society, Nationwide, Paragon, Aldermore and Zopa let you open as many as you like. The best one-year fixed rate Isa from Nottingham BS pays 4.66 per cent, fixed until 14 October 2025.

Bond yields in a race to the bottom

Popular one-year Treasury yields have fallen sharply over the past four weeks in what appears to be a race to the bottom.

In early August, a whopping 20 accounts were paying 5 percent or more. Now, only two remain — and don’t expect them to be around much longer.

Union Bank of India pays 5.25 percent on a minimum amount of ₹1,000, while Access Bank (₹5,000 or more) pays 5 percent.

The second best rate is 4.9 percent from Atom Bank on £1 or more.

Some banks, including Shawbrook, Hodge Stream, SmartSave and United Trust, have cut their rates more than once.

The biggest cuts come from MBNA Savings, where the rate dropped from 5.15 percent to 4.65 percent. Tandem Bank dropped from 5.12 percent to 4.45 percent.

If you have to pay tax on your savings, you’re better off with a cash ISA.

Sy.morris@dailymail.co.uk