Overview
- Executives from Hargreaves Lansdown, HSBC and Lloyds challenged Treasury and HMRC officials in a heated 13 January meeting over plans to curb cash use within investment ISAs.
- From April 2027, savers under 65 will see the cash ISA allowance cut to £12,000, with the remaining £8,000 ring‑fenced for stocks and shares, while those 65 and over keep the £20,000 limit.
- Treasury and HMRC are designing anti‑circumvention measures including bans on transfers into cash ISAs from investment ISAs, tests for ‘cash‑like’ assets, and potential charges on interest held as cash within investment ISAs.
- A reported proposal for a 22% flat charge on interest on cash inside stocks and shares ISAs remains unconfirmed and is being described in coverage as an option under exploration.
- HMRC told MPs it will lay regulations in Parliament and described the age carve‑out as legally robust, while industry groups and MPs warned the approach risks complexity, penalising temporary cash holdings and denting confidence, with some firms quitting a related promotion campaign.