Act now or lose your ISA allowance for good

Your ISA is issued on a “use it or lose it” basis, and if you don't act by midnight on April 5, you've lost it for good. If that timetable sounds tight, you have even less time than you think, because this tax year falls over the Easter weekend.

Your ISA allows you to save up to £15,000 in the current financial year and take your interest and capital gains free of tax. Every UK adult is entitled to an ISA, and you don't want to squander yours by failing to get your act together. Even the under-16s are eligible, family and friends can save up to £4,000 on their behalf in Junior ISA.

Some 14 million people will make a last-minute dash to use their ISA allowance in time, according to new research from Santander.

If you have any spare cash or existing savings, transferring them into an ISA allows you to get a competitive return on your money, and shield the returns from the taxman.

You can invest in either cash or stocks and shares in any combination, up to that £15,000 limit. Most people can't afford to save that much, but saving a little is better than saving nothing at all.

If you repeatedly use at least some of your ISA allowance over the years, you should eventually build a decent tax nest egg. And you won't have to pay any tax on the income or capital growth while you're alive, married couples can even pass their ISA to their partner on death, free of inheritance tax.

Don't delay, because deciding where to invest your ISA isn't easy. ISAs aren't an investment in themselves. They’re a wrapper that you can place around different savings or investments to shelter them from tax.

You can choose between hundreds of tax-free savings accounts, known as cash ISAs, mainly sold by banks and building societies. The problem is that low interest rates have hammered the returns on cash, which now pay on average just 1.44%.

You can get a better potential return by investing in stocks and shares ISA, but remember your capital is at risk. You can choose from thousands of different investment funds, and should spread your money around to reduce risk.

Whichever option you choose, you shouldn't just go to your bank or building society to buy your ISA, you should get a much better deal by shopping around.

The clock is ticking, and you don't have long to make your decision. April 5 is almost upon us.