Savers reminded of Isa tax benefits

Consumers must continue to use individual savings accounts Isas, it has been claimed.

Jason Butler, a partner at Bloomsbury Financial Planning, said savers should not be put off by slim returns on their investments and should remember that Isas also offer vital tax-free limits.

From this year, consumers will be able to invest £5,100 in a cash Isa tax-free, plus the same amount in a stocks and shares account.

Mr Butler claimed that while accessing the best savings interest rates will always be important, minimising costs and tax "really do matter when your returns are quite low".

"They matter more in a low return environment than they do, paradoxically, in a high return, low inflation environment," he said.

"I'm not saying it's [currently] a good deal for cash investors, but cash rates will rise at some stage, just when is the question."

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2010-01-28 13:01:51 © Moneyextra.com