Important Things We Have To Know About The New ISAS Rules
By Angela Sanders Monday, April 07 2014 @ 06:54 AM EDT
One of the most important things that we have to understand about ISAs is the fact that they are now turning into NISAs (new ISA). There are significant changes that will happen but the great news is that we are faced with a lot more freedom and flexibility.
When referring to fewer options and lower interest rates, the savers that are over 50 will surely appreciate the opportunities that they have since the money will work better for them, in a highly efficient tax manner. We saw that the budget that was announced for ISAs from July 1 is higher at 15,000 pounds. This is something about ISAs that will grab your attention since we are faced with a thirty percent increase on shares ISA limit and stocks. For cash ISAs we have an increase of 160 percent.
The maximum investment can be put into absolutely all combinations of shares, stocks or cash that the NISA likes. We have the added benefit of switching between available options whenever we want. The people that had investments done last year can move towards NISA with the preferred combination. They do not have to hold 2 account types as you can hold cash in stocks and NISA shares in just one account. Even so, most people will want to do this separately.
The added flexibility is really important when thinking about choosing NISA providers. Savers can transfer the providers as often as possibly desired. We have 5 million individuals that use a full ISA allowance on a yearly basis so we are faced with really good news about ISAs. More people will be encouraged to save so that tax benefits are gained. To put it simple, new ISAs will bring in freedom and flexibility.
ISA Changes at a glance:
- Annual allowance increased to 15,000 pounds. Now the maximum is of 11,520 pounds.
- The maximum allowance can be put in stock or cash and share NISAs. Combinations of these 2 are possible.
- As soon as the investments are open, the people can switch between the providers at any point in time he/she may desire.
- People that have grandchildren or children under the age of 18 have an annual allowance of 4,000 pounds for the junior cash ISAs.
- The savings from the previous year can be transferred into shares NISAs and stocks with the desired proportion.
Remember the fact that you are only allowed to hold a single stocks and shares NISA and one cash NISA for the duration of one tax year. The combined contribution is the one mentioned above. On the whole, these changes are highly beneficial and you surely already figured out the fact that the added flexibility will be of great aid for so many people that want to get the most out of their investments. These changes also open the door for different providers so the market will be more competitive. Such a situation can only be beneficial for the investors and new ISAs should be considered.