Higher Limits in ISAs: Call

Higher Limits in ISAs: Call

FundsNetwork has argued that the annual tax-free investment limit should have been raised from £7,000 to £10,000, instead of the modest £200 increase.  They have also called on the Government to make further changes to its ISA legislation, in addition to the changes that have already been introduced on 6 April 2008.  

If the ISA limit had risen in line with the rate of inflation, it would now stand at more than £8,900.  The group said it would like to see a limit of £10,000 introduced, or a commitment from the government to a rising scale - £8,400 from 2009 - £9,600 from 2010 and so on – figures that are all divisible by 12 for monthly savers.

Our view

It was 20 years under the Conservatives that you were allowed to save up to £9,000 in a TESSA (Tax Exempt Special Savings Account) and £6,000 in a General PEP (Personal Equity Plan) and £3,000 in a Single Company PEP.  

This is some difference to the Labour replacement tax efficient savings plan of £7,000, now £7,200 in an ISA Individual Savings Accounts.  The rest of your savings and investments are potentially taxed.  

Did we go backwards or what? Now do you believe you are being stealth taxed?

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Learn more about ISA Individual Savings Accounts and related topics in the Savings Adviser Channel 

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