There are mounting calls for the Government to increase the ISA (Individual Savings Account) allowance.
ISAs offer the advantage of zero tax liability on investment gains or interest earnings. Under existing rules, it is possible to allocate a maximum of £20,000 across different ISA types, such as cash ISAs, innovative finance ISAs, stocks and shares ISAs or lifetime ISAs.
A campaign, which now has a petition on the Parliament website, is asking the Treasury to let savers invest more in the savings account, which is tax-exempt. It hopes that the allowance will be raised to £25,000 a year. The previous rise was in 2017, and the existing cap is currently in place until 2030.
There have been some indications in recent weeks that the Chancellor of the Exchequer, Rachel Reeves, might look to introduce a new ceiling on the total amount people can deposit into cash ISAs. Indeed, at a recent meeting with the Treasury Committee, she said she was assessing ways of reforming ISAs.
The new tax year, which began on April 6, offers a fresh start for ISA savers, as the allowance resets. Anyone with outside assets wanting to transfer money into an account might consider taking swift action. It is believed that the earlier this is done, the more protected you will be from dividend tax, before your investments have time to generate a dividend.
Should you need savings advice in Cheshire and require more guidance on ISAs, get in touch with our team at Hartey Wealth Management today to set up an appointment.
