• Personal Savings Allowance relief will have increased by 40% during the 2022/23 tax year from £350 million to £590 million due to higher interest rates.
- Tax incentives for ISAs also will have increased by 17% from £3.5bn to £4.3bn over the same period also partly due to higher interest rates.
The research also noted that 77% of personal finance tax incentives are for pension schemes, which are projected to be worth £27bn to taxpayers in the 2023/24 tax year.
The overnment recently removed the Lifetime Allowance charges ahead of the allowance being abolished next year. The maximum amount a person can save into their pensions each year without taxation has also risen from £40,000 to £60,000.
Meanwhile, there has also been an increase in the money purchase annual allowance, meaning individuals can now draw a maximum of £10,000 from their pensions without additional charge, compared to the previous £4,000 maximum. These changes will add an extra £4.5bn to pensions tax incentives offered between 2022/23 and 2027/28.
The research also showed that personal finance tax breaks continue to increase but remains slow at 4%, half the percentage increase between the 2020/21 and 2021/22 tax years.