Will the introduction of a new personal savings allowance in April mean a move away from cash ISA's?
Low interest rates and changes to savings taxation are resulting in "perhaps the worst Isa season on record", a financial analyst said. The returns available to savers putting money into a cash Individual Savings Account (Isa) are among the lowest seen, Moneyfacts said. Moneyfacts said the best easy-access Isa rate was 1.41%. This was well down on the top rate of 3.15% offered five years ago. The returns for Isa savers have been hit by low interest rates, as well as the introduction of a new personal savings allowance in April, which will mean most savers will be free from tax on their savings interest anyway. The change means basic rate taxpayers will be able to earn up to £1,000 in savings interest tax-free and higher rate taxpayers will be able to earn up to £500 in tax-free savings income.