Budget  

Budget 2024: Isa subscription limits frozen until 2030

Budget 2024: Isa subscription limits frozen until 2030
Chancellor of the Exchequer, Rachel Reeves (Leon Neal/Getty Images)

Individual savings accounts annual subscription limits will be frozen until April 5, 2030.

In the Autumn Budget today (October 30), it was revealed that the limit will remain at £20,000 for Isas, £4,000 for Lifetime Isas and £9,000 for Junior Isas and Child Trust Funds.

In addition to this, it was also noted that the government will not proceed with the British Isa due to mixed responses to the consultation launched in March 2024.

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The British Isa was announced by Jeremy Hunt in the Budget in March.

At the time, Hunt had said this would allow an additional annual investment for UK equities with all the other tax advantages of other Isas.

But the Labour government later came out and said it had dropped plans for this product, which it confirmed in the Budget today.

Susannah Streeter, head of money and markets, Hargreaves Lansdown, said: ‘’It’s a relief to see plans for a UK Isa finally dumped on the scrapheap. 

“It was a well-intentioned idea but was set to lead to unfortunate consequences. The plan was to direct shareholders' money into UK-listed companies, but such a move would have added unnecessary complexity and could have a negative impact on UK investors. 

“If they had been nudged into a UK Isa, it would have potentially increased risk by unnecessarily concentrating portfolios. This could be a detriment, especially if there was more volatility in the London markets compared to others.”

Streeter said UK retail investors are already enthusiastic holders of UK equities, around 35 per cent hold UK equities directly with 80 per cent of trades by value taking place on the London market.  

She said many more clients will be investing in the UK through funds. 

“There was a chance that the existence of a separate UK Isa may also have ended up providing no significant boost to UK investment,” she said. 

“Those who already held a stocks and shares Isa might have simply hived off all their existing UK holdings to the UK ISA, and used the extra wiggle room to invest more overseas in their usual ISA. 

“For others, the complexity may have put them off putting money into equities, given that simplicity is what many investors desire.”

The government also stated that it will extend the current Help to Save scheme until April 5, 2027. 

This is a savings product for low-income working individuals with a 50 per cent government bonus.

Following a consultation, the government has taken feedback from stakeholders and a framework for a reformed scheme design has been developed.

With effect from April 6, 2025, eligibility will be extended to all universal credit claimants who are in work. 

sonia.rach@ft.com