📨 Have you signed up to the Forum's new Email Digest yet? Get a selection of trending threads sent straight to your inbox daily, weekly or monthly!

MSE News: Teens can save up to £19,000 tax-free thanks to ISA loophole

Former_MSE_Helen
Former_MSE_Helen Posts: 2,382 Forumite
in ISAs & tax-free savings
16 and 17-year-olds can save up to £19,000 tax-free this year under today's ISA revamp...
Read the full story:

Teens can save up to £19,000 tax-free thanks to ISA loophole

OfficialStamp.gif


Click reply below to discuss. If you haven’t already, join the forum to reply. If you aren’t sure how it all works, read our New to Forum? Intro Guide.

Comments

  • DragonQ
    DragonQ Posts: 2,198 Forumite
    Part of the Furniture 1,000 Posts
    Shame there's no teens out there with £19,000 to spare.
  • p00hsticks
    p00hsticks Posts: 14,505 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    DragonQ wrote: »
    Shame there's no teens out there with £19,000 to spare.

    Or any ISAs/NISAs/JISAs paying a good enough rate of interest comared to other products to make it worth doing ....
  • jamesd
    jamesd Posts: 26,103 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    This is wrong: "The only exception is where money is given to a child by each parent, which generates more than £100/year in interest (so £200/year for a couple)". The ore correct rule is each parent and up to £100 of interest from the gifts from that parent. The £100 allowance isn't transferable between parents and it is not necessary for "each parent" to give for the tax to be due, one parent is sufficient.

    Only parents are affected by this restriction, not others.
  • Former_MSE_Liane
    Former_MSE_Liane Posts: 27 Forumite
    Hi jamesd,

    Thanks for pointing that out - it's now been amended.

    Liane
  • Pincher
    Pincher Posts: 6,552 Forumite
    1,000 Posts Combo Breaker
    How do they check the money comes from the child or parent?


    If I was a drug dealer with lots of cash, I would recruit lots of teenagers, pay the cash in monthly, then close the JISA and NISA after a year, and transfer the money out to legitimate accounts. The teenager gets a cut, or some free drugs.
  • scotkiwi
    scotkiwi Posts: 6 Forumite
    MSE_Liane wrote: »
    Hi jamesd,

    Thanks for pointing that out - it's now been amended.

    Liane

    But it doesn't make it clear that money in the Jisa isn't taxed under the £100 rule, only the money in a Nisa would be if the source is a parent.
  • Archi_Bald
    Archi_Bald Posts: 9,681 Forumite
    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
    scotkiwi wrote: »
    But it doesn't make it clear that money in the Jisa isn't taxed under the £100 rule, only the money in a Nisa would be if the source is a parent.
    No it would not be taxed. All interest in ISAs and JISAs is tax free.
  • jimjames
    jimjames Posts: 18,755 Forumite
    Part of the Furniture 10,000 Posts Photogenic Name Dropper
    £19k?

    Paper rounds obviously pay more than when I was a lad...
    Remember the saying: if it looks too good to be true it almost certainly is.
  • gadgetmind
    gadgetmind Posts: 11,130 Forumite
    Part of the Furniture 10,000 Posts Combo Breaker
    Some let youth be a barrier while others don't.

    http://www.bbc.co.uk/news/business-28129967

    I earned more during my 5th year than the teachers did and I made jolly sure that they all knew!
    I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.

    Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.
  • Speculator
    Speculator Posts: 2,367 Forumite
    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
    jamesd wrote: »
    This is wrong: "The only exception is where money is given to a child by each parent, which generates more than £100/year in interest (so £200/year for a couple)". The ore correct rule is each parent and up to £100 of interest from the gifts from that parent. The £100 allowance isn't transferable between parents and it is not necessary for "each parent" to give for the tax to be due, one parent is sufficient.

    Only parents are affected by this restriction, not others.


    Also, if the parent giving the money is a non taxpayer (earning less than £10,000) you are allowed keep the R85 on the childrens account even if the child is earning over £100 in interest!

    I spoke to HMRC and they confirm that this is correct.
This discussion has been closed.
★ ★ ★ Meet your Ambassadors

🚀 Getting Started

Hi new member!

Our Getting Started Guide will help you get the most out of the Forum

Categories

  • All Categories
  • 351.4K Banking & Borrowing
  • 253.3K Reduce Debt & Boost Income
  • 453.8K Spending & Discounts
  • 244.4K Work, Benefits & Business
  • 599.7K Mortgages, Homes & Bills
  • 177.2K Life & Family
  • 258K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 16.2K Discuss & Feedback
  • 37.6K Read-Only Boards

Is this how you want to be seen?

We see you are using a default avatar. It takes only a few seconds to pick a picture.
Update Your Picture