NatWest has contacted its customers following the Autumn Budget announced by Chancellor Rachel Reeves on Wednesday. In an email, the bank advised recipients to review their financial plans in light of the government's announced changes to cash ISA limits.
Under the new rules, savers under 65 will only be able to contribute up to £12,000 per year into a cash ISA tax-free, down from £20,000. Those aged over 65 will retain the full £20,000 allowance. The aim is to encourage investment in stocks and shares ISAs instead.
The changes apply to new contributions from 6 April 2027 onwards, meaning customers have the current tax year and next to save up to £20,000 in a cash ISA if they wish. Money already saved in cash ISAs will remain protected and continue to earn tax-free interest.
Separate to the ISA changes, from April 2027 the income tax on savings interest outside ISAs will increase to 22% for basic-rate taxpayers, 42% for higher-rate, and 47% for additional-rate.
NatWest advised customers to consider their options, noting that while investing is not right for everyone, it could help achieve long-term goals. The bank emphasised the importance of keeping cash savings for everyday expenses and unexpected costs, but highlighted that investments carry risk.
