New British Isa and British Savings Bond announced in Spring Budget

Two new savings products - the British Isa and British Savings Bond - have been announced in the Spring Budget today.

After months of speculation stemming back to November's Autumn Statement, Chancellor Jeremy Hunt has confirmed plans to introduce a new stocks and shares Isa that will exclusively focus on UK-listed companies.

Savers opening a British Isa (also being referred to as a 'UK Isa') will be rewarded with an additional £5,000 allowance on top of the existing Isa allowance of £20,000.

Speaking in the Commons, Hunt said those opening British Isas would 'benefit from the growth of the most promising UK businesses'.

A British Savings Bond will also be launched from April this year, allowing savers to lock their cash away for three years on a fixed interest rate.

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British Isa launch date yet to be announced

This new type of Isa joins a host of existing Isa types including cash, stocks and shares, lifetime, junior, Help to Buy and innovative finance Isas.

Savers can already save up to £20,000 tax-free annually across the existing types of Isa.

However the British Isa announced today provides a separate, additional £5,000 allowance which is solely for investment in UK assets. 

The date when British Isas will become available has not yet been announced, with the government promising to consult on the details.

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British Savings Bond offers three-year guaranteed rate

Launching next month, this savings product will be available through state-owned bank and premium bonds provider NS&I and offer a guaranteed interest rate for three years.

It's not yet clear how competitive the rates will be against comparable three-year bonds on the market, but NS&I says it will update its website soon with more information.

The bonds themselves will go on sale in early April. In common with all other savings and investments held at NS&I, British Savings Bond holders' money will be backed by the Treasury. 

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What was missing for savers in the Budget?

A number of rumoured savings changes failed to materialise in the Chancellor's speech today. 

Lifetime Isa limit: Isa reform: 

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.

source https://www.which.co.uk/news/article/new-british-isa-and-british-savings-bond-announced-in-spring-budget-ab5g11r1NOxO