One in ten UK adults expect to use their full New ISA allowance in the current tax year according to new research from YouGov.
New ISAs (NISAs) came into effect on 1 July and allow consumers to save or invest up to £15,000 tax-free (an increase from £11,880 from previous ISAs). Unlike previous ISAs, there is no limit on the percentage that can be saved against the percentage invested.
YouGov’s research suggests the scheme will be popular, with one in ten UK adults (10%) expecting to deposit or invest the full £15,000 allowance in the current tax year. A further two in ten (21%) expect to use some of their allowance, while four in ten (39%) do not intend to open a NISA at all. The remaining 29% do not know what they will do.
The study finds that the public has good levels of awareness about NISAs. Just over half (54%) of the UK adult population knew that the scheme was coming into effect, with awareness being particularly high among holders of cash ISAs (71%) and stock and shares ISAs (81%). Older people are also more likely than younger people to know about the scheme, with over two thirds (68%) of over-55s knowing they were coming into effect compared to a third (34%) of under-25s.
Despite the relatively high number of people who are looking to use NISAs, YouGov’s findings show large numbers of young and middle aged people are facing difficulties in putting money aside for the future. Almost half (46%) of 35-44 year-olds and a similar number (43%) of 45-54s don’t believe they will be able to use any of their ISA allowance in the current tax year.
The study also asked people how they would split the full £15,000 allowance if they had it available to place in a NISA. On average, UK adults expected to deposit £11,250 in cash and invest the remaining £3,750 in stocks and shares. There were slight differences between the genders, with men depositing £10,600 and investing £4,400, and women depositing £11,900 and investing £3,100.
Simon Mottram, Lead Consulting Director at YouGov, said: “With one in ten people saying they intend to put the full £15,000 into a NISA, it looks like the government has made the right move in increasing the allowance and removing the restriction on the level of cash. However, it will be interesting to see who is able to fill up their NISAs, with the concern being that the main beneficiaries will be those who are already financially comfortable.”
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