‘Billions’ lost to the taxman as people still not taking out an Isa

Those having difficulties with debt may want to take note that tax payers are wasting money by not utilising an individual savings account (Isa), a study has suggested.

Research carried out by the Fair Investment Company has shown that people are throwing away an estimated accumulative amount of £15.5 billion in unnecessary tax payments.

The firm said that 37 per cent of payers subscribed to a cash Isa in the 2008-2009 period, meaning that the remainder lost money, which could have otherwise been saved.

Nick Scarrett, head of investment and pensions at the business, said that the statistics “highlight the fact that by paying tax on the money they could have saved in an Isa, UK taxpayers have thrown away billions of pounds in tax payments”.

Less than one in ten individuals in Britain are aware of what the new Isa limit will be from the upcoming tax year, Lloyds TSB has revealed.

By Joe Shervin