Investors reaped rich dividends from Isa
Isa savings were launched in 1999 to protect cash, from tax. Many people have made hundreds of thousand Pounds in Isa. However, ministers have considered controlling the benefits. The amount that can be held in tax-free Isa is considered to be capped in radical measures.
In the initial period of Isa, savers can put 7000 Pounds per years with 3000 Pounds in cash in Isa. The current limit for 2013-2014 tax year, is 11,520, half in investments and half in cash. In the last financial year, 15 million Isa were opened with an average deposition of 3,900 Pounds, per account.
Isa proved better than other schemes
The maximum amount of funds that an individual can put in Isa is 124,000 Pounds as of now. But before Isa was launched, people saved through personal equity plans and the maximum fund that could be held in PEP was 88,000 Pounds. When the Isa was launched, there were options provided to the investors to transfer their savings from PEP to Isa. There is no official announcement of the cap amount in Isa but Treasury claims that there is no future plan to cap after this.
The current top Isa cash options are Tesco Instant Access Cash Isa (2%), Virgin Money (1.75%), West Bromwich Building Society (3.15%) and Coventry Building Society (2.75%). Tesco Instant Access Cash Isa does not allow transfers.
Source: http://www.thisismoney.co.uk/money/saving/article-2463152/Is-Government-set-cap-savers-hold-tax-free-Isa.html