Martin Lewis' Predictions On The New British ISA For People With Over £5k In Their Accounts

A newly introduced ISA from the UK Government is said to be beneficial for wealthier investors that have maxed out their £20k tax-free allowance on a previous ISA.

Households with £5,000 in savings will have the opportunity to invest in a new type of ISA later this year.

The UK Government has confirmed that this will be introduced to encourage investment in the UK and boost the economy.

Chancellor Jeremy Hunt announced: “This will be on top of the existing ISA allowances and ensure that British savers can benefit from the growth of the most promising UK businesses as well as supporting them with the capital to help them expand.”

New ISA benefits big-savers

The British ISA applies to people who have maxed out their £20,000 tax-free allowance on an ISA.

Money Saving Expert Martin Lewis posted on X, formerly known as Twitter, saying “it will probably happen later this year and there’ll be a £5,000 extra if you’re investing in British assets.”

Kevin Brown, saving specialist at Scottish Friendly, said it was “encouraging” to see the ISA allowance extended “in the form of an extra £5,000 tax-free to invest exclusively into the UK.”

He added: “Saving and investing is increasingly important for people that are trying to marshal their stretched resources through the current economic turbulence.”

Martin Lewis shares more news for UK savers

On the Money Saving Expert website, Martin Lewis said: “Starting in ‘early April’, these savings accounts will offer a fixed rate for three years on deposits of between £500 and £1 million – though we don’t yet know what that rate will be.”

He also added that despite the campaigning from him and his team to ensure that savers buying a home that’s now over the scheme’s property price limit of £450,000 aren’t hit by a 6.25% fine for accessing their own cash, the government isn’t immediately tackling this but a “shake up isn’t off the table.”

Here’s hoping.