<\/p>\n
So rather than subjecting yourself to the mad rush of deciding how to fully utilise your 2019\/20 ISA allowance, now is a good time to start preparing how you intend to use it. You also need to remember that if you don\u2019t use your current ISA allowance by 5 April 2020, you\u2019ve lost it forever.<\/p>\n
You can shelter returns from tax<\/strong> A married couple could invest \u00a340,000 before 5 April 2020, followed by a further \u00a340,000 on 6 April 2020 \u2013 a total of \u00a380,000 invested, with all profits or dividends completely free from UK Income Tax and Capital Gains Tax.<\/p>\n Time to consider your ISA options?<\/strong> Cash ISA<\/strong> Stocks & Shares ISA<\/strong> Junior ISA<\/strong> Help to Buy: ISA<\/strong> Lifetime ISA<\/strong> Innovative Finance ISA<\/strong> INFORMATION IS BASED ON OUR CURRENT UNDERSTANDING OF TAXATION LEGISLATION AND REGULATIONS. ANY LEVELS AND BASES OF, AND RELIEFS FROM, TAXATION ARE SUBJECT TO CHANGE.<\/p>\n THE TAX BENEFITS RELATING TO ISA INVESTMENTS MAY NOT BE MAINTAINED.<\/p>\n THE VALUE OF INVESTMENTS AND INCOME FROM THEM MAY GO DOWN. YOU MAY NOT GET BACK THE ORIGINAL AMOUNT INVESTED.<\/p>\n PAST PERFORMANCE IS NOT A RELIABLE INDICATOR OF FUTURE PERFORMANCE.\t\t<\/p>\n","protected":false},"excerpt":{"rendered":" Use your ISA allowance or lose it forever Even though the Individual Savings Account (ISA) deadline may be a number of months away, and despite the tax year date remaining the same year in year out, somehow it always creeps up on us. A tax year runs from 6 April one year to 5 April […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"_links":{"self":[{"href":"https:\/\/www.clarksonhall.co.uk\/news\/index.php\/wp-json\/wp\/v2\/posts\/2885"}],"collection":[{"href":"https:\/\/www.clarksonhall.co.uk\/news\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.clarksonhall.co.uk\/news\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.clarksonhall.co.uk\/news\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.clarksonhall.co.uk\/news\/index.php\/wp-json\/wp\/v2\/comments?post=2885"}],"version-history":[{"count":0,"href":"https:\/\/www.clarksonhall.co.uk\/news\/index.php\/wp-json\/wp\/v2\/posts\/2885\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.clarksonhall.co.uk\/news\/index.php\/wp-json\/wp\/v2\/media?parent=2885"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.clarksonhall.co.uk\/news\/index.php\/wp-json\/wp\/v2\/categories?post=2885"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.clarksonhall.co.uk\/news\/index.php\/wp-json\/wp\/v2\/tags?post=2885"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
\nISAs are a means of saving tax-efficiently and were introduced by the Government to encourage more of us to save and invest. Each tax year, the Government sets a limit on the amount you can contribute to an ISA (currently \u00a320,000).<\/p>\n
\nThere are six different types of ISA, and they each have slightly different features:<\/p>\n
\nBasic and higher-rate taxpayers receive a Personal Savings Allowance (PSA) that sets the amount of interest they can earn tax-free in any year. The total amount you can save in a Cash ISA in the current 2019\/20 tax year is \u00a320,000. Using a Cash ISA gives you further flexibility to earn interest from the ISA without paying tax on it. Different accounts are available, which can offer easy access to your money \u2013 useful for short-term savings. When deciding what to do with any spare money you have, it\u2019s worth bearing in mind the effect of inflation on what your money can buy. If inflation is higher than the interest you\u2019re earning, then the cost of living is going up faster than the rate at which your money is growing.<\/p>\n
\nIn the current 2019\/20 tax year, you can invest up to \u00a320,000 in a Stocks & Shares ISA, which is generally considered a medium to long-term investment. You have complete flexibility as you can choose to invest your money in a wide range of different investments, and any money you make in profit or dividends is completely free from UK Income Tax and Capital Gains Tax. You can invest a single lump sum or smaller amounts, but you must remember that once the tax year is over, if you have not used all your ISA allowance, you will lose it.<\/p>\n
\nJunior ISAs are a way to save tax-efficiently for your children. There are two types of Junior ISA: a Cash Junior ISA and Stocks & Shares Junior ISA. Family and friends can put up to \u00a34,368 into the account on behalf of the child in the 2019\/20 tax year. There\u2019s no Income Tax or Capital Gains Tax to pay on the interest or investment gains. Junior ISAs are available to any child under 18 living in the UK. The ideal festive gift this year!<\/p>\n
\nA Help to Buy: ISA was introduced to help first-time buyers save towards the cost of buying their first home. You can make an initial deposit of \u00a31,000 when you open a Help to Buy: ISA, and then receive \u00a350 for every \u00a3200 saved up to a maximum of \u00a312,000. The tax incentive is capped at \u00a33,000. You also earn tax-efficient interest on your savings as with a standard ISA. These ISAs are limited to one per person rather than one per house. You can\u2019t contribute to a Cash ISA in the same tax year. The Help to Buy: ISA scheme closes on 30 November 2019. After that date, they won\u2019t be available to new savers anymore. However, if you opened your Help to Buy: ISA before then, you can keep saving into your account until 30 November 2029 when accounts will close to additional contributions. You must also claim your bonus by 1 December 2030.<\/p>\n
\nThe Lifetime ISA is a longer-term tax-efficient savings account that will let you save up to \u00a34,000 per year and receive a government bonus of 25% (up to \u00a31,000). As with other ISAs, you won\u2019t pay tax on any interest, income or capital gains from cash or investments held within a Lifetime ISA. It\u2019s designed for first-time buyers between the ages of 18 and 40 to use towards a deposit for their first home or towards future retirement savings once they reach 60 years of age.<\/p>\n
\nAn innovative finance ISA (IFISA) lets you use your tax-efficient ISA allowance while investing in peer to peer (P2P) lending. They work by lending your money to borrowers, and in return you receive interest based on the length of time and the risk of your investment. However, they are considered higher risk than other types of ISA due to the risk of default by borrowers and the lack of a secondary market for these types of assets.<\/p>\n