Higher tax allowance limit is driving Isa giveaways

The head of Halifax savings said more people were becoming conscious of the need to set aside money to spouses and children, although most adults wanted to have control over their own savings pots.

He said: “People still desire the security and independence of having our own savings. There’s an understandable caution at work here, as savings often play a pivotal role in our future plans, from retiring to going on holiday.”

Mr Fearon’s comments came after the bank’s poll of consumers revealed that, with this year’s tax allowances growing to £15,000 for Isas, 52 per cent of men and 44 per cent of women would look to gift any unused allowance if they reached their tax-free limit.

This could create a tax-free savings pot of £30,000 a year, despite the money legally becoming the property of another individual.

However, despite the apparent readiness to cede control of money for tax benefits, the bank’s survey of 2000 adults on their attitudes to financial trust in partners, also found that up to 47 per cent of women were unwilling to trust partners with their savings, compared to 37 per cent of men.

Additionally, 39 per cent of couples with children said they would not trust their partners with their savings or were unsure if they should.

Adviser view

Robin Hunter, principal of West Midlands-based Hunter & Co, said: “We sometimes see money transferred to children, but to intentionally cede control of money to capitalise on an increased Isa allowance, except for husbands and wives, would be too fraught and too risky against the potential tax benefit.”