New ISA launched
The New ISA (NISA) that was announced by the Chancellor as part of the 2014 Budget announcements came into effect on 1 July 2014. The NISA introduces equal limits for cash and stocks and shares investments. This will allow savers to transfer funds from stocks and shares ISAs to cash ISAs.
The NISA has a far more generous annual investment limit of £15,000 an almost tripling of the pre 1 July 2014 cash limit of £5,940 and a significant increase from the previous £11,880 allowance for stocks & shares ISAs. All existing ISAs will become NISAs. Any subscriptions made to an ISA since 6 April 2014 will count against the £15,000 NISA subscription limit for 2014-15.
The Government estimates that by 2018/19 over 6 million people will benefit from the higher limit. In addition, the limits for Junior ISAs and Child Trust Funds have also been increased to £4,000 from 1 July 2014.
At the launch of the NISA, the Chancellor of the Exchequer George Osborne said:
‘Today’s introduction of the New ISAs is a big boost for millions of people, giving them greater economic security by putting aside money in savings.’