Isa Increase ..when ?

manchesterred

As i recall the amount you put into a cash isa increases sometime soon from £3600 .. can someone tell me when that is please, as i am yet too take up my isa allocation for this financial year...
And when this kicks in can we look forward to some healthier rates being offered as banks compete for our money ?

Lokolo

If you are 50 or over on X date, then October.

Anyone else April 6th 2010. When the new tax year starts.

Biggles

You can put up to £3,600 in at any time now. Then, if you're 50 or over before 6 Apr 2010, you can increase it to £5,100 any time from 6 Oct 09 onwards.

I wouldn't like to bet on any great rates becoming available then, but there's probably no harm hanging on with your whole £5,100 just in case!

manchesterred

Biggles wrote: »

You can put up to £3,600 in at any time now. Then, if you're 50 or over before 6 Apr 2010, you can increase it to £5,100 any time from 6 Oct 09 onwards.

I wouldn't like to bet on any great rates becoming available then, but there's probably no harm hanging on with your whole £5,100 just in case!

Thanks for that, i wasnt aware of the 50 age thing, but with rates so pants i will probably hang on a bit

Paul_Herring

And when this kicks in can we look forward to some healthier rates being offered as banks compete for our money ?

I wouldn't have thought so.

Biggles

manchesterred wrote: »

Thanks for that, i wasnt aware of the 50 age thing, but with rates so pants i will probably hang on a bit

If you're under 50, the £5,100 comes into effect from 6 Apr 10, you just have £3,600 for this financial year.

rb10

manchesterred wrote: »

And when this kicks in can we look forward to some healthier rates being offered as banks compete for our money ?

I would be very surprised if this happened. Many people will have paid in £3600 in April, so all of them are now committed to adding the other £1500 into the same account, because of the rule that you can only subscribe to one ISA in each tax year. So there can't be any competition for these people.

Paul_Herring

so all of them are now committed to adding the other £1500 into the same account, because of the rule that you can only subscribe to one ISA in each tax year.

It's entirely permissible to move this year's subscriptions to another bank.

rb10

Paul_Herring wrote: »

It's entirely permissible to move this year's subscriptions to another bank.

True - many people will be on a fixed term though and so able to add in the extra £1500 to that bank, but not able to transfer the £3600 they've already put in.

financial_illiterate

Just out of interest (and I appreciate this was probably discussed when it was announced), why is the limit for over 50's being raised earlier than for everybody else?

p00hsticks

financial_illiterate wrote: »

Just out of interest (and I appreciate this was probably discussed when it was announced), why is the limit for over 50's being raised earlier than for everybody else?

It was political - the argument being that retired people who often don't have mortgages but rely on savings to provide monthly income were particularly badly affected by the drop in interest rates.

See sections 7.1, 7.2 and 7.3 in the document linked to here for the official policy statement

http://www.opsi.gov.uk/si/si2009/em/uksiem_20091550_en.pdf