Money alert: ISA limits 2013-14

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The Independent Online

So now we know how much we'll be able to stash away in our tax-free individual savings accounts from next April.

The Chancellor confirmed in his Autumn Statement on Thursday that the inflation-linked rate rise in the Isa allowance would push the limit up to £11,880 for the 2014-15 tax year. That is an increase of £360 in the amount of your savings you can shelter from tax demands.

The cash Isa element will rise from £5,760 to £5,940. But the extra £180 effectively means an extra tax saving of just 65p a year for basic-rate taxpayers, assuming an interest rate of 1.80 per cent, which is what the best easy access Isa currentlypays.

Meanwhile the Junior Isa allowance will increase by £120 to £3,840 in April 2014.

The increases may seem small but if you haven't yet made use of your 2013-14 Isa allowances it means you could stash £23,400 away from the clutches of the Treasury in the next four months. Couples have the attractive possibility of saving £46,800 tax-free.

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