Chancellor Jeremy Hunt used the Spring Budget to announce the introduction of a new British Isa.

Today (6 March) Hunt unveiled that the British Isa will come in the form of an extra £5,000 tax-free allowance to encourage UK retail investment.

Aegon pensions director Steven Cameron said: “The new British Isa will appeal to those who currently max out their Isa limits, providing scope for an extra £5k tax-free saving. It will also offer transparency, appealing to those who wish to be certain their investment is staying within the UK. It will be important the forthcoming consultation creates an unambiguous definition of what qualifies as a UK investment within a ‘British Isa’.”

Cameron did add a word of caution regarding the new Isa and added: “Investors should however be mindful about putting all their ‘eggs in one basket’.

“Diversifying across different asset types and geographical locations can be an important way of managing investment risk, something which should be emphasised to potential investors.”

However, he does feel that “the chancellor clearly wants to take every opportunity to use all types of savings and investments to boost UK economic growth.”