The annual allowance for a cash ISA will rise from the current £5,340 to £5,640 next tax year. The full amount that can be invested into a stocks and shares ISA will rise to £11,280.
It is fair to say that savers have been quietly suffering as a result of low interest rates in recent years. The gloom would not have been lifted by news that consumer price inflation has risen above 5% to the highest level in 19 years.
Every cloud has a silver lining however, and the good news is that the most recent inflation figures are the ones that will be used to set the new ISA limits which will take effect in April 2012. The ISA limit is linked to the previous September's Consumer Price Index (CPI), which is the government's preferred measure of inflation.
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