£382m ISA tax gains loss

Monday, 03 March 2008 12:00

Brits are losing out on £382 million worth of tax breaks by failing to use their ISA allowances.

As the tax year deadline of April 5th approaches, and firms start to release new ISAs to attract savers, many are still losing out and choosing to hand cash to the taxman.

Unbiased.co.uk, which promotes independent financial advice, estimates nearly four million people hold equities but do not use ISAs - resulting in £133 being paid in tax unnecessarily.

Meanwhile savers are giving the Treasury £249 million by not making use of an ISA.

This year the annual limits for ISAs are £3,000 for cash ISAs and £7,000 for maxi ISAs.

David Elms, chief executive of IFA Promotion, which runs Unbiased.co.uk, said: "Savers should use the next weeks to make sure they have made full use of their ISA allowance - if you decide not to save into an ISA, you will end up paying more tax.

"And once you have missed the April 5th deadline, you will lose you tax-free savings allowance for the 2007/ 2008 tax year."

In total Unbiased.co.uk calculates UK savers are paying £7.9 billion in too much tax this year alone.

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