Budget: £15000 ISA Limit from 01/07 for Cash OR S&S

DragonQ

Great news for savers...if only the cash ISA rates were any good!

From 1st July 2014, the ISA limit will be £15,000 and anyone can transfer all of their current S&S ISAs to cash ISAs, or the other way around.

I'm not clear on whether the ISA limit increase will occur as usual on the 6th April or not. It might be that the limit increases to £15,000 on 6th April, and then the ability to freely switch between S&S and cash starts on 1st July.

Archi_Bald

weird date but otherwise a welcome announcement

rpc

The devil is in the detail - this could screw up my plans for 14/15.

The higher limit is nice, but if you are only allowed to subscribe to one "New ISA" each year then the flexibility of saving both cash and S&S is eroded a bit.

It is a nice gift, but so few savers used their cash ISA allowances anyway...

DragonQ

10% savings tax band is being abolished too, although not relevant to ISAs.

rpc wrote: »

The devil is in the detail - this could screw up my plans for 14/15.

The higher limit is nice, but if you are only allowed to subscribe to one "New ISA" each year then the flexibility of saving both cash and S&S is eroded a bit.

It is a nice gift, but so few savers used their cash ISA allowances anyway...

This is true. Looks like more flexibility for past years' savings but less for current year savings.

Consumerist

Great stuff on ISAs. I wondered whether I'd heard that correctly:beer:.

lisyloo

I guess we'll have to wait and see but I don't understand how these new ISAs will work.
Aren't the companies that provide S&S wrappers eg. H&L generally different to the banks and building societies that provide cash ISAs?

Nednats

It seem like you will now be able turn a S&S ISA into cash.
I have lots in a cash ISA and I have been debating turn some of it in a S&S ISA as the rates on cash ISAs are so low. But the fact that once you transfer to S&S ISA it can't be turned back is off putting.

Possible Loophole - Take out the full years allowance as S&S and then transfer to Cash. Then you could put double in a cash ISA in a year.

Archi_Bald

The way I understand it is you do not need any loophole. You can put at total of £15 into cash and/or S&S ISAs. You decide how much to put into which bit.

Scarpacci

lisyloo wrote: »

I guess we'll have to wait and see but I don't understand how these new ISAs will work.
Aren't the companies that provide S&S wrappers eg. H&L generally different to the banks and building societies that provide cash ISAs?

I don't think it will be any more complicated than it is now. You should still be able to have a S&S ISA with the likes of H&L and a cash ISA with banks.

HMRC already have to deal with that sort of thing now, so a fully flexible allowance doesn't look like it would pose problems. In essence, we already have one allowance for S&S and within that a portion up to £5,760 can go to Cash ISAs. So people can already open two ISAs and split their allowance, with restrictions, between those two. HMRC will just pay attention to how many ISAs of each type are opened a year and the total contribution between them, as they already do.

Archi_Bald

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/293759/37630_Budget_2014_Web_Accessible.pdf

NISA discussed from 1.167. Not that it answers all my questions... :-(

Consumerist

Scarpacci wrote: »

I don't think it will be any more complicated than it is now. You should still be able to have a S&S ISA with the likes of H&L and a cash ISA with banks. .

My understanding of the announcement is that that there will be only one type of ISA which may be used for cash and S&S. It's not clear to me whether this new ISA can be split between different managers.