Thank you to Shares reader Thomas, who suggested we cover the ISA changes announced in the Autumn Statement. If you also want to get ahead with next year’s ISA planning, here is a reminder of what is happening from 6 April 2024.

ALLOWANCES STAY THE SAME

The ISA allowances have been frozen for 2024/25.

That adds up to a total of £20,000 across all your ISAs – including the £4,000 limit for Lifetime ISAs – and a Junior ISA allowance of £9,000.

FLEXIBILITY TO PAY INTO MULTIPLE ISAS OF THE SAME TYPE

That could be a direct debit into a Stocks & Shares ISA on one investment platform, and later in the year a ‘Bed and ISA’ on another, to move investments into another ISA there.

Cash ISA savers might want to mix and match between an easy access cash ISA with one provider and locking in a fixed term account with another.

There are two things to keep in mind though:

The flexibility will not be extended to Lifetime ISAs; and
You will need to keep a close eye on your multiple ISAs to make sure you do not bust your overall allowance.

GOODBYE TO TRANSFER RED-TAPE

From 6 April, you will be able to transfer as much (or as little) as you want between different providers.

Right now, if you want to transfer cash and investments bought with money you paid in this year, you will have to move it all at once.

NO NEED TO REAPPLY FOR DORMANT ISAS

Getting rid of this little known rule makes it easier to pay into ISAs that are already open. You might have been asked to ‘reapply’ for existing ISAs in the past – an ISA is dormant if no money has been paid in into it for a whole tax year.

INNOVATIVE FINANCE ISAS EXTENDED

You will soon be able to invest in long term asset funds (LTAFs) and open-ended property funds with redemption periods in the Innovative Finance ISA. HMRC figures show that this type of ISA made up only 0.13% of the ISAs paid into last year so this new home for these unloved property funds looks little more than a marriage of convenience.

Fractional shares to come

The Government plans to consult on allowing certain fractional shares in ISAs. This could be good news for investors who want to buy into some of the big US brands that are currently out of reach for smaller, regular investments due to their share price.

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