Healey reverses plan to cut annual ISA allowance

Summarised from 4 outlets · 8 reports · Updated 28 Oct, 13:58 · Archive

Chancellor John Healey has reversed plans to cut the annual ISA allowance from £20,000 to £12,000, an alteration he announced in his budget.

The proposed cut would have applied to savers aged under 65 and was scheduled to come into force in April 2027. In announcing the reversal, Healey stated: 'The limit will stay at £20,000 per year, tax-free for people of all ages, and to make investment more accessible, I will work with the sector to create a new starter ISA to reward first-time investors.'

Individual Savings Accounts allow people to save or invest without paying tax on interest, dividends or capital gains within the account. The annual allowance of £20,000 means eligible savers can deposit up to that amount into ISAs each tax year without paying tax on returns.

ISAs remain one of the UK's most popular savings products. HM Revenue and Customs figures show that around £135.7 billion was paid into adult ISAs in the 2024-25 tax year, an annual increase of £32.7 billion, with much of the growth coming from cash ISAs.

The reversal comes after the original proposal prompted concern. Finance Expert Rachel Springall at Moneyfactscompare.co.uk said the planned changes would have added complexity and waste, noting that providers had already begun spending time and money preparing their systems for the April implementation. The announcement of the cut had also prompted savers to deposit billions of pounds into cash ISAs ahead of the proposed changes.

How it is being reported

• John Healey scraps Reeves' £8,000 ISA cut as 'savers will be delighted'Chancellor John Healey has reversed unpopular plans to cut the annual ISA allowance from £20,000 to £12,000 in a potential boost for savers.Cumberland News · 28 Oct, 13:37
• John Healey scraps Reeves' £8,000 ISA cut as 'savers will be delighted'Chancellor John Healey has reversed unpopular plans to cut the annual ISA allowance from £20,000 to £12,000 in a potential boost for savers.Westmorland Gazette · 28 Oct, 13:37
• John Healey scraps Reeves' £8,000 ISA cut as 'savers will be delighted'Chancellor John Healey has reversed unpopular plans to cut the annual ISA allowance from £20,000 to £12,000 in a potential boost for savers.Whitehaven News · 28 Oct, 13:37
• John Healey scraps Reeves' £8,000 ISA cut as 'savers will be delighted'Chancellor John Healey has reversed unpopular plans to cut the annual ISA allowance from £20,000 to £12,000 in a potential boost for savers.NW Evening Mail · 28 Oct, 13:37
• John Healey scraps Reeves' £8,000 ISA cut as 'savers will be delighted'Chancellor John Healey has reversed unpopular plans to cut the annual ISA allowance from £20,000 to £12,000 in a potential boost for savers.NW Evening Mail · 28 Oct, 13:22
• John Healey scraps Reeves' £8,000 ISA cut as 'savers will be delighted'Chancellor John Healey has reversed unpopular plans to cut the annual ISA allowance from £20,000 to £12,000 in a potential boost for savers.Cumberland News · 28 Oct, 13:22
• John Healey scraps Reeves' £8,000 ISA cut as 'savers will be delighted'Chancellor John Healey has reversed unpopular plans to cut the annual ISA allowance from £20,000 to £12,000 in a potential boost for savers.Westmorland Gazette · 28 Oct, 13:22
• John Healey scraps Reeves' £8,000 ISA cut as 'savers will be delighted'Chancellor John Healey has reversed unpopular plans to cut the annual ISA allowance from £20,000 to £12,000 in a potential boost for savers.Whitehaven News · 28 Oct, 13:22

In this story: John Healey · Rachel Springall · HM Revenue and Customs · Moneyfactscompare.co.uk · United Kingdom

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