CPI slows as ISA increase calculated
When the new tax year starts, it will bring with it a welcome boost for savers in the form of an increase in the amount that can be invested tax free in an ISA.
The Chancellor, George Osborne, tied increases in the ISA limit to the Consumer Price Index (CPI) from April 2012. With HM Revenue & Customs (HMRC) traditionally using September’s results to calculate the following year’s figures, this generated an increase of 2.2 percent, or £248.16.
Unfortunately, this is a drop from the 2.5 percent CPI level of just a month earlier.
As HMRC pledged to round the limit up to a multiple of 12 to make it easier for monthly savers to calculate their funds, this would result in a new ceiling of at least £11,532, and potentially as much as £11,580, of which half could be invested in a Cash ISA.
These figures will be confirmed in the Chancellor’s Autumn Statement, to be delivered on 5th December 2012.