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What we know about the new British ISA

02/04/2024

In his Spring Budget on Wednesday, March 6th, Chancellor Jeremy Hunt announced plans to introduce a new British ISA. Read on to find out more about what it will involve, and how it will work. 

 

Why is a “British ISA” being introduced? 

Unsurprisingly, the Government is looking to boost the overall economy – as well as the prospects for British businesses. With the UK stock market having seen less-than-ideal performance in recent years, the new ISA is a bid to further support UK-listed companies in their search for growth. 

However, it is not just businesses that the new British ISA could help. It will also increase investors’ tax-free allowances, giving them greater investment opportunities. 

 

How will the new ISA work?

The new British ISA will give investors an extra tax-free £5,000 per year – on top of their existing £20,000 allowance – to invest. However, this sum must be invested solely in UK stocks and shares. 

It is expected that the new ISA will appeal to investors who have already reached their £20,000 limit and want to invest more money tax-free. However, there are still questions around how such an ISA will actually work. 

An upcoming consultation will help to define what actually counts as a “UK investment” to be included within a British ISA. While the aim is to boost the flagging UK economy, though, is a British ISA really the best solution? Some experts suggest that increasing the core ISA limit, allowing investors greater flexibility in where they invest, could have been a better choice. 

 

“Stable Rise Limited is not authorised or registered by the Financial Conduct Authority. The marketing materials are not intended to provide financial advice nor promote any individual financial products.”

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