Autumn Statement 2023: savers to be allowed to pay into multiple Isas per year

Savers will be able to pay into more than one of each type of Isa annually, as part of the biggest shake-up of Isa rules in recent years.

The change, coming into force from April 2024, will enable savers to easily move between different providers in search of higher returns, in a bid to encourage competition and boost rates.

And those with innovative finance Isas will be able to invest tax-free in a broader range of investments from April.

The shake-up comes as a decade of record low interest rates has ended and savings returns have climbed, with the best cash Isas now paying 5% or more.

• Find out what else is changing with our full Autumn Statement 2023 round-up

Isa changes at a glance

The following changes will come into force from April 2024:

• Single Isa limit scrapped: Savers will be allowed to open and pay into multiple Isas of the same type in a single tax year without losing their £20,000 allowance. Current rules only let you put money into one of each type of Isa every tax year. It's hoped the change will incentivise competition among Isa providers and boost interest rates.
• Partial transfers allowed: You'll be able to transfer part of your account balance from one Isa provider to another, rather than being forced to transfer the lot. This means you can keep some funds with your existing provider and retain that account.
• No more reapplying: Currently, if you have an Isa lying dormant, you're forced to reapply for it each year. Under the new rules that won't be necessary, and the Isa will remain open, ready for you to resume use of the account if you wish.
• Innovative finance Isa boost: The range of permitted investments for these Isas has been expanded to include long-term asset funds and open-ended property funds with extended notice periods.
• Adult Isa harmonisation: The minimum opening age for adult Isas will be 18 across the board.

The government has also promised to consult on making fractional shares a permitted Isa investment, and to digitise the Isa system in order to create 'digital tools to support investors'. However, no timeline has been announced for either of these measures.

What was missing?

Some rumoured changes to the Isa system failed to materialise in the Autumn Statement. These include:

• Lifetime Isa limits: The government has resisted pressure to raise the house price limit on a Lifetime Isa (Lisa) to keep up with house prices. Lisas can be used to buy properties costing up to £450,000, but average house prices in some parts of the country are now far higher than that. This has led to some Lisa savers being penalised when withdrawing their money to buy a home - a situation that looks set to continue.
• Great British Isa: The Daily Telegraph speculated about the introduction of a new stocks and shares Isa for UK-listed companies only, with savers who utilise the product set to be rewarded with an additional £5,000 allowance. But no new Isa types or expanded allowances were announced today.

What is an Isa?

The term Isa stands for 'individual savings account', and allows you to save tax-free into a cash savings or investment account.

Isa accounts are offered by banks, building societies, insurers, asset managers and National Savings and Investments (NS&I).

In recent years, new types of Isa have been unveiled, and there are now five different types of adult Isa, plus Junior Isas for children aged 17 and under.