Healey ‘to scrap planned cut on cash ISA allowance’ in Budget

Chancellor John Healey is expected to scrap the planned reduction in the annual cash ISA allowance, restoring the £20,000 limit for savers. The proposed cap of £12,000 for people under 65 had been intended to encourage more investment, but critics argued it would add complexity and could affect building societies’ mortgage funding.

Industry figures welcomed the reported reversal, while saying other ISA changes may also need review. These included taxing interest on uninvested cash held in stocks and shares ISAs and banning transfers from those accounts to cash ISAs. Quilter’s Jo Harris noted that only 22.7 per cent of ISA subscribers used their full allowance in 2022/23, while 42 per cent saved less than £2,500.