12:49 am Thu 11 Mar 2010
Sheila
Tarr
Independent
Financial
Services

Investments: ISAs

 
In 1997, the government decided that the existing tax-free savings schemes were not sufficiently accessible to a large proportion of the population. It was estimated that 50% of the population of the UK had less than £200 in savings with a further 25% having no savings at all.

The government subsequently introduced, from 6 April 1999 the individual savings account (ISA). Its stated objectives are to develop the savings habit and to ensure that tax relief on savings is fairly distributed. Investors are exempt from income and capital gains tax on their ISA investments. Subscription Limits

From 6 April 2008 the government made a series of changes to the way ISA's work. These changes were designed to offer simplicity and flexibility to investors. The key changes to subscription limits are listed below:

  • Mini & Maxi ISA's will no longer exist. They will be replaced with Stocks & Shares ISA's and Cash ISA's.
  • You can invest up to £3600 into a Cash ISA
  • You can invest up to £7200 into a Stocks & Shares ISA
  • Overall annual savings limit of £7200
  • All Personal Equity Plans (PEP) will automatically become Stocks & Shares ISA's
  • Any Cash saved so far in ISA's can be rolled forward into a new Stocks & Shares ISA, in addition to that years contribution limit.

In the 2009 Budget, the Chancellor announced the following changes to ISA’s
  • The annual investment limit has gone up to £10,200, up to £5,100 of which can be saved in cash
  • These higher limits will be available for people aged 50 and over from 6 October 2009, and to everyone from 6 April 2010
If you would like us to review an existing ISA you already hold or would like to invest into a new ISA, please contact Sheila Tarr I.F.S


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