New tax year, new Isa limit available for savers
From 6 April 2012, the Isa limit has been increased to £11,280, of which £5,640 can be saved in a cash Isa.
With average top rates up by 0.20% since last year there is even more reason for consumers to consider how to make the most of their allowance. A comparison of Isa products against non-Isa products also shows little difference between rates; however tax payers will reap the reward from tax free benefits offered by Isas.
Since the new tax year began, there have been a number of new Isa bond product launches including the Starter Isa Issue 2 from Nottingham Building Society offering a market leading rate of 5%. In the easy access Isa market there have also been a couple of new launches from the building societies, for example, Nationwide has launched the Flexclusive Isa with a rate of 4.25%. This is only available to new or existing FlexAccount customers.
Kevin Mountford, head of banking at moneysupermarket.com, said: “The start of the new tax year should encourage all those savers who failed to make use of their Isa allowance to make a fresh start this year and ensure any savings they have are in a tax efficient wrapper.
“By thinking about your Isa allowance at the beginning of the year rather than at the end it means you can make the most of protecting your savings from the tax man and help boost your savings pot. Many people will have focused on sorting this year’s allowance rather than transferring their existing pot, so consumers should make it a priority to action this sooner rather than later.”