Overview
- Unconfirmed proposals ahead of the 26 November Budget include reducing the cash ISA cap to £10,000–£12,000 and raising income tax rates by 1p–2p.
- The i’s modelling indicates five‑year extra tax of about £619 for basic‑rate savers, £1,989 for higher‑rate savers, and more than £3,377 for additional‑rate savers under a £10,000 cap with a 2p rise.
- Paragon Bank research finds nearly two thirds would not switch to stocks and shares ISAs if the cash limit fell, with 57% likely to use standard savings accounts.
- Experts describe the combination as a double whammy for cash savers, though most people do not use the full £20,000 ISA allowance so the impact would be concentrated.
- Coverage also flags potential changes to workplace pension tax breaks as part of the developing Budget package.