With the tax year ending on 5 April, cash ISA savers have just hours left to secure their full allowance. A quarter of holders remain unaware of the deadline, raising concerns over missed savings opportunities.
The end of the 2023/24 tax year is prompting a last-minute rush among millions of savers in the UK. The annual ISA allowance of £20,000 resets on 6 April, and any unused portion cannot be carried over, meaning unclaimed tax benefits will be lost for good.
According to investment firm Charles Stanley, as many as 13 million people may be impacted, with younger savers most at risk of missing the deadline. The urgency to act stems from both the fixed allowance and the potential for changes in government policy in the future.
Millions Unaware of the ISA Cut-off Date
Despite the widespread use of ISAs in the UK, a significant proportion of savers remain unclear about the rules surrounding their allowances.
According to Charles Stanley, 24% of ISA savers do not know there is an annual deadline, with levels of awareness particularly low among younger demographics. Data reveals that 31% of Generation Z and 27% of millennials are unaware of the cut-off date, compared to only 11% of Baby Boomers.
During the 2022/23 tax year, 12.4 million UK adults contributed to an ISA. Rob Morgan, Chief Investment Analyst at Charles Stanley, noted that ISAs are “the Swiss army knife of financial planning”, citing their tax efficiency, accessibility, and flexibility for both short and long-term goals.
He warned, however, that widespread confusion around the rules suggests many are not optimising their savings strategies.
In addition to the deadline issue, speculation continues over potential changes to ISA rules in future budgets. This uncertainty further highlights the need for savers to act promptly before the end of the current financial year.
Best Rates Still Available for Last-Minute Savers
While acting at the eleventh hour may not be ideal, several competitive ISA options remain available. According to Moneyfacts, one of the most attractive current offers is a one-year fixed-rate cash ISA from OakNorth Bank, offering 4.45% interest and allowing transfers in from existing cash ISAs.
Sarah Coles, head of personal finance at Hargreaves Lansdown, advised that those pressed for time may choose to secure their allowance now and make investment decisions later. “It’s a great idea to divide the decision to open an ISA to protect your allowance, and the choice of where to invest,” she said.
