Here is the good news about holding an ISA, which is simply an acronym for an individual savings account. Whatever capital gains taxes you have from 1999, consider them all erased. It is as simple as this: An ISA account equals zero capital gains taxes.
Now that you are on full alert, hopefully it does not dampen your spirits that an ISA does have its limits, which is £10200. The limit applies to your combined ISA cash, stocks, and shares. Also, a special limit is applied to a cash ISA. It cannot be more than £5100. Luckily, the cash portion of an ISA can be easily converted to stocks and shares but get this: Not the other way around.
You have to be over eighteen years of age to own stocks and shares ISA , which is of course reasonable, if not understandable. No doubt because of the special privileges offered by this account, some underage individuals might attempt to circumvent the rule. The word on the street is do not.
Not every kind of investment or financial instrument may be eligible for loading into an ISA account.
The following is a list of investments with the go signal:
Corporate bonds and shares
Gilt Edged securities
OEICs and Unit trusts
Life insurance policy
ETFs
Reasoning Behind the Government ISA Mentality
ISA replaces the PEP as well as the TESSA. Consider it as the government’s fresh take on encouraging ordinary people to mind the importance of investing and to start thinking about jump starting or if not, boosting their investment portfolio. In these economically uncertain times, having an ISA makes perfect sense.
But do not think for a second that introducing the ISA concept is an act of government benevolence or a dole out. The taxman, after all, is still interested in your money.
At the same time, however, the government recognizes the fact that people have a tendency to skimp on investing when times are hard. When nobody wants to invest, go figure what happens to the economy. You had better get the best Roth IRA broker advice on this.
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