26 February 2014
Nationwide Building Society has called on the Chancellor to equalise the limits for cash ISAs and stocks and shares ISAs in this year's Budget, part of a package of measures the Society believes will make ISAs simpler and easier to understand for the UK's savers.
Nationwide's Chief Executive, Graham Beale, has written to the Chancellor to highlight the importance the Society places on supporting the savings aspirations of the country's consumers and the role ISAs can play. In the letter, Nationwide reiterated requests to improve the ISA regime, providing simplicity and support for savers, through;
- Increasing the annual deposit limit for cash ISAs to equal the limit for stocks and shares ISAs – to both reduce confusion and encourage new savers. Currently, you can only save up to a maximum of £5,760 in a cash ISA, but you can save up to £11,520 in a stocks and shares ISA
- Allowing transfers from stocks and shares ISAs into cash ISAs – to provide greater flexibility, particularly for those wishing to have easier access to their savings, such as older people and those approaching retirement
- Enabling first time homebuyers to save even more in a tax-efficient cash ISA account towards a deposit for their home
Graham Beale comments: "In the current climate of depressed rates, the need for a flexible and supportive savings regime has arguably never been greater. As an industry we need to demonstrate support for hard pressed savers, and making ISAs more straightforward may encourage more people to make the most of their tax-efficient ISA allowance."
Last year, Nationwide undertook research which showed that two thirds (66%) of ISA savers wanted cash ISA limits brought into line with higher equity limits for all savers, and that almost a third (31%) found the differences between the two limits confusing.
HMRC data suggests that in 2012/13 approximately four cash ISAs were taken out for every one stocks and shares ISA*, suggesting that the majority of savers want the greater flexibility that cash ISAs allow to access their money.
Mr Beale continues: "The Chancellor holds the power to reinvigorate the UK's savings culture in his hands. The industry needs to reward those who prepare for their future, whilst recognising the changing demands of the present. It's the right thing to do."
Nationwide further encouraged the Chancellor to reform the current 'slab' structure of Stamp Duty Land Tax; asking him to consider a fairer, more proportionate system, which would overcome the current distortions created in the housing market. This would offer practical help not just to the many first time buyers working on achieving an affordable home of their own, but also to families seeking larger accommodation to fit their changing circumstances, those needing to move for work and those wishing to downsize.
Notes to editors:
*HMRC data for 2012/13 shows there were 11.7 million cash ISAs taken out and 2.9 million stocks and shares ISAs.
About Nationwide Building Society
Nationwide is the world's largest building society as well as one of the largest
providers and a top-three provider of
mortgages in the UK. It is also a major provider of
Nationwide has around 15 million members.
Customers can manage their finances in a branch, on the telephone, internet and post. The Society has around 15,000 employees. Nationwide's head office is in Swindon with administration centres based in Northampton, Bournemouth and Dunfermline. The Society also has a number of call centres across the UK.