March 9 2014 Latest news:
Adam Aiken, Editor
Friday, March 30, 2012
Savers have been warned that they risk missing out on their annual tax-free Isa allowances if they leave things to the last minute.
The Financial Ombudsman Service said it usually saw a rise in complaints at this time of year from people who had failed to take advantage of their “use-it-or-lose-it” allowance.
Although the ombudsman sometimes rules that customers should be compensated when they have tried to use their Isa allowances but their providers have made mistakes, banks and building societies cannot be blamed if you fail to take action in time.
“At this time of year, the ombudsman service sees a big increase in complaints about Isas where people have missed deadlines,” said chief ombudsman Natalie Ceeney.
“So do not leave it until the very last minute before getting your application in.”
The current Isa limit is £10,680 a year, and you are allowed to invest up to half that amount (£5,340) in a cash Isa. These accounts are offered by all high-street banks and building societies.
But if you fail to invest in an Isa before the end of the tax year on April 5, you cannot carry forward your allowance to next year.
You can still open an account from April 6, but at that point you will be eating into your 2012-13 allowance.
The amount you can save in an Isa next year will rise to £11,280, and up to half of that can be in a cash Isa.