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  • FIRST POST
    • Former MSE Helen
    • By Former MSE Helen 5th Dec 12, 11:38 AM
    • 2,324Posts
    • 971Thanks
    Former MSE Helen
    MSE News: Autumn Statement: Cash Isa limit to rise to £5,760
    • #1
    • 5th Dec 12, 11:38 AM
    MSE News: Autumn Statement: Cash Isa limit to rise to £5,760 5th Dec 12 at 11:38 AM
    "The cash Isa limit will rise to £5,760, while the overall Isa limit will rise to £11,520 next April..."

    Last edited by Former MSE Helen; 05-12-2012 at 2:16 PM.
Page 1
    • Froglet
    • By Froglet 5th Dec 12, 3:23 PM
    • 2,457 Posts
    • 2,963 Thanks
    Froglet
    • #2
    • 5th Dec 12, 3:23 PM
    • #2
    • 5th Dec 12, 3:23 PM
    Hardly generous,the increase.It was proposed that pensioners,who are probably more wary of stocks and shares,could use the full quota as cash.But no,no benefits for them as usual,the very people who are having to live on their savings at ever decreasing interest rates.

    Edit,just read the article which mentions the above.
    Last edited by Froglet; 05-12-2012 at 3:26 PM.
  • kylehp04
    • #3
    • 6th Dec 12, 5:21 PM
    • #3
    • 6th Dec 12, 5:21 PM
    Does it matter?Apparently 23% of Brits are barely breaking even at the end of each month.

    So there are a large number of people out there who wont be able to take advantage of the tax benefit anyway
  • ILW
    • #4
    • 6th Dec 12, 5:28 PM
    • #4
    • 6th Dec 12, 5:28 PM
    Does it matter?Apparently 23% of Brits are barely breaking even at the end of each month.

    So there are a large number of people out there who wont be able to take advantage of the tax benefit anyway
    Originally posted by kylehp04
    Only because many have run up unnecessary debts.
    • ChiefGrasscutter
    • By ChiefGrasscutter 6th Dec 12, 5:56 PM
    • 2,066 Posts
    • 1,982 Thanks
    ChiefGrasscutter
    • #5
    • 6th Dec 12, 5:56 PM
    • #5
    • 6th Dec 12, 5:56 PM
    Beats me why many use S&S isa's.
    You get charged by the ISA provider for the ISA wrapper on top of the fund charges.
    Any company dividends paid within the ISA are still taxed at the 10% value.
    So exactly what are you gaining - apart from possible CGT relief within the ISA and in todays'/last 10 years of stockmarket performance you haven't been making much gain at all I expect.
    Only if you are a higher rate taxpayer do you avoid the higher rate tax normally due by keeping funds within the ISA
    Income from fixed interest bonds is not taxed within an ISA so yes I agree that is an advantage if you are only holding stocks/bonds/gilts.

    I recall at the time the taxation of dividends inside an ISA was changed that commentators said that S&S ISA's would only be of interest to higher rate taxpayers from now on.
    • westy22
    • By westy22 6th Dec 12, 6:13 PM
    • 1,040 Posts
    • 847 Thanks
    westy22
    • #6
    • 6th Dec 12, 6:13 PM
    • #6
    • 6th Dec 12, 6:13 PM
    Beats me why many use S&S isa's.
    It is true that the benefits of a S&S ISA are greater for a HR taxpayer but there are still the benefits of CGT elimination; rebated tax on bonds as you state; and less administration and HMRC reporting requirements even for basic rate taxpayers. These benefits alone are worth it as there are several platforms that don't charge extra for investments to be held in an ISA.

    in todays'/last 10 years of stockmarket performance you haven't been making much gain at all I expect
    Obviously that varies hugely between individuals but my S&S ISA has grown at an annualised rate of about 8% per annum over the past 10 years. If that had not been in an ISA and I wished to draw all the money out today I would be facing a very significant CGT bill.
    Old dog but always delighted to learn new tricks!
    • jimjames
    • By jimjames 6th Dec 12, 6:48 PM
    • 10,460 Posts
    • 8,444 Thanks
    jimjames
    • #7
    • 6th Dec 12, 6:48 PM
    • #7
    • 6th Dec 12, 6:48 PM
    Beats me why many use S&S isa's.
    You get charged by the ISA provider for the ISA wrapper on top of the fund charges.
    So exactly what are you gaining - apart from possible CGT relief within the ISA and in todays'/last 10 years of stockmarket performance you haven't been making much gain at all I expect.
    Originally posted by ChiefGrasscutter
    1) The vast majority of fund charges are no different for holding inside an ISA that outside so you might as well be inside and sheltered from tax.

    2) Not sure what performance you've been looking at but I recently sold an investment made just over 10 years ago at 18% annual growth. Not sure I've seen that return from a cash ISA over the last 10 years!

    Apart from the benefit to high rate taxpayers it means you are sheltered from tax in the future and don't need to worry about including on tax returns.

    I guess the more people think like you the better as it means the chancellor is more likely to keep S&S ISAs going.
    Remember the saying: if it looks too good to be true it almost certainly is.
    • guitarman001
    • By guitarman001 6th Dec 12, 6:50 PM
    • 977 Posts
    • 516 Thanks
    guitarman001
    • #8
    • 6th Dec 12, 6:50 PM
    • #8
    • 6th Dec 12, 6:50 PM
    As one who is to be in the 40% bracket soon... I'll be looking for ways to minimise extra taxes on savings. LOATHE to do stocks/shares but if there are 'safe' bond bets I'd be glad to hear of them. Doubt there is.
    • jimjames
    • By jimjames 6th Dec 12, 6:59 PM
    • 10,460 Posts
    • 8,444 Thanks
    jimjames
    • #9
    • 6th Dec 12, 6:59 PM
    • #9
    • 6th Dec 12, 6:59 PM
    As one who is to be in the 40% bracket soon... I'll be looking for ways to minimise extra taxes on savings. LOATHE to do stocks/shares but if there are 'safe' bond bets I'd be glad to hear of them. Doubt there is.
    Originally posted by guitarman001
    Depends what you mean by safe. Bonds have done very well recently but there are funds that shouldn't drop too much in value if all goes wrong.

    Some of the experienced bond investors may be able to give more info
    Remember the saying: if it looks too good to be true it almost certainly is.
    • A Flock Of Sheep
    • By A Flock Of Sheep 6th Dec 12, 10:30 PM
    • 4,030 Posts
    • 4,520 Thanks
    A Flock Of Sheep
    It goes up to £5760! Woopsydooodah! Why can't they let people put the full £11k+ as a cash ISA? I don't want some risky Stocks and Shares rubbish.

    With the rates ever tumbling it's going to be more viable to keep your cash hidden like Ken Dodd did!
    • realaledrinker
    • By realaledrinker 6th Dec 12, 11:12 PM
    • 1,448 Posts
    • 459 Thanks
    realaledrinker
    Does it matter?Apparently 23% of Brits are barely breaking even at the end of each month.
    Originally posted by kylehp04

    Matters to the other 77% though.
    Ethical moneysaver
    • jimjames
    • By jimjames 6th Dec 12, 11:24 PM
    • 10,460 Posts
    • 8,444 Thanks
    jimjames
    Matters to the other 77% though.
    Originally posted by realaledrinker
    I'm not sure it does either. 23% break even, the rest probably don't have savings to fill an ISA.

    The average salary is approx £25k before tax.

    Even the current limit of £5760 is 20% of average pre tax income so not very likely for someone at that level to fill an ISA let alone at £11k.

    I don't want some risky Stocks and Shares rubbish.
    Originally posted by A Flock Of Sheep
    You mean some rubbish that might have a chance of matching or beating inflation rather than losing value month after month like cash?
    Remember the saying: if it looks too good to be true it almost certainly is.
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