Autumn Statement 2013: Cash Isa limit creeps up to £5,940

The annual limit will nudge up from £5,760 to £5,940 when the new tax year begins on 6 April.

Osborne also confirmed in his Autumn Statement that the overall current Isa limit will rise from £11,520 per tax year to £11,880 from next April.

Cash Isas are normal savings accounts, with the crucial exception that interest is not taxed.In a stocks and shares Isa, gains are largely tax-free.

Savers can use the whole Isa limit for stocks and shares investments, but only half of it for cash. See our Full Isa guide for more details.

MoneySavingExpert.com money analyst Helen Saxon says: "While the increase in the Isa allowance is small, it's great that people will be able to keep a little more of their hard-earned savings interest from the taxman.

"But the real challenge in this era of rock bottom interest rates will be finding an account that pays decent interest." For the best buys, see our Top Cash Isas guide.

No Child Trust Fund switch announced

The amount that can be saved in a junior Isa or Child Trust Fund will also rise from next April, increasing from £3,720 to £3,840.

Unlike normal Isas, with junior Isas you can choose how much of that total allowance you use for cash or investments.

But Osborne made no announcement on whether savings can be transferred from Child Trust Funds (CTFs) to junior Isas, following the launch of a consultation on the issue back in May this year (read the Child Trust Funds MSE News story).

CTFs typically have poorer interest rates on regular savings products compared with junior Isas – but money in one can't be transferred into a junior Isa at present.

Only children born on or after 3 January 2011, or before September 2002, are eligible for a junior ISA. CTFs, on the other hand, are tax-free savings accounts available for kids born between 1 September 2002 and 2 January 2011.