The amount of money Britons stash into stocks and shares Isas hit a record high in the last tax year as income-starved savers took on more risk in their hunt for returns.

Just over £80bn was saved into Isas, which are highly popular tax-free accounts, in the year to April, according to HM Revenue & Customs, writes Naomi Rovnick.

Of this figure, £58.8bn was stashed into cash Isas, which was a slight drop on the year before.

But the amount of money that went into investment Isas, which allow savers to buy stocks, bonds or funds without having to pay tax on their gains, jumped by a fifth on the previous year to £21.4bn.

That was the highest amount of money Britons have put into stocks and shares Isas since Isas were launched in 1999.

The Isa is Britain’s most popular way of saving and investing. Cash Isas have traditionally been the most popular version of the account, with stocks and shares Isas generally failing to win ground.

Although this data only covers the year to April, it is widely predicted that the cash Isa will fall further in popularity as interest rates on the product have fallen in line with the Bank of England base rate. The average “easy access” cash Isa now pays only 0.86 per cent in annual interest, which is a record low.

The performance of stocks and shares Isas also outdid cash last year.

The market value of Isa holders’ cash holdings rose by 6 per cent compared to the year before, HMRC said. The market value of funds held in stocks and shares increased by 9 per cent.

It was possible to save up to £15,240 into Isas last year, although the limit is being raised to £20,000 from next April.

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