The forthcoming increase to the cash ISA limit is set to confuse many Brits, with less than one in 10 people knowing what the new limit will be from the new tax year, Lloyds TSB has said.
According to the high street bank, despite the vast majority of people – 86 per cent – knowing that an ISA is a savings account, only 11 per cent admit to being aware what current cash ISA limit is. In addition, just nine per cent of Brits are aware of what the new cash ISA limit will be when it is increased on 6 April from £3,600 to £5,100.
Brits aged between 45 and 54 appear to be the most savvy when it comes to ISAs, with 95 per cent correctly stating that it is a type of savings account. In contrast, a quarter of 18 to 24 years are unsure what an ISA is, with six per cent claiming that it is an iPhone application.
Encouragingly, almost two thirds of Brits think that cash ISAs are a good way to save as tax is not payable on any interest earned, while 41 per cent understand that they cannot top up their ISA using their allowance from the previous tax year if they did not use their full entitlement for that particular year.
Commenting, Richard Davies, senior savings manager at Lloyds TSB said: "It is really positive to see how many people are ISA aware and understand the benefits Cash ISAs offer. However, it is obvious that there is some confusion surrounding the increase in Cash ISA limits."
© Fair Investment Company Ltd