Protecting pensions from politicians - or preparing for a Labour coalition

How is it tax avoidance - tax already should been paid on the income which been saved and generates further income.

May be because one may other try to earn more if one will know that further benefits from that money would be taxed again? How many times is it right to tax money which individual has depending on what that individual does with it ? Why not to tax pocket money children get from their parents or any gifts ? Suppose it depends on what kind of society one wants to build. I am sure in so.e of those using ISA would be considered "tax avoidance" and frowned upon. Keeping in mind limited allowance we are not talking about millions which would generate large amounts of tax free income as a result of clever machinations where sky is the limit. If one feels that further taxing those who got 500 k into ISA is the right thing to do then lowering the yearly limit is an option. But wait , it just being raised trying to promote prudence and save rather than spend now and depend on state attitude. For the record I stand no chance accumulating half a million so it is not a matter of self-interest. I agree current 20 k (is it 20 k?) ISA allowance goes beyond encouraging an average member of public to save so I guess it could be halved without affecting the spirit of it. I am not sure it would make much of a difference in a budget though. Introducing taxes on already accumulated ISAs would been extremely unfair as it would be rewriting rules of the game retrospectively and I hope not to ever see it happen.

Chrysalis wrote: »

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For me I work to provide for myself yes, but I also work to provide for the country. .........

You are not alone, we all work to provide for the country as short of emigrating, we have no choice in the matter.

What percentage of tax one pays depends on how much income one has and how much you spend on buying things. So if you happen to earn £10000 per year, then increasing your tax payment by 10% is not very generous.

If you happen to receive a huge amount of income, then you probably have enough money not to notice the reduction in your standard of living if you paid 10% more tax so still not very generous of you

If you happen to be on say £22000 and struggling to pay a mortgage, feed and cloth your family while holding down a tough job then paying 10% more tax than at present would be very generous.

Chrysalis wrote: »

its right as long as the government says its right.

I would agree with your claims it isnt worth it if its taxed IF the tax was at 100%, but it is not.

Children do get tax, in the form of VAT.

I did post earlier saying I think alot of taxes should be removed, and instead just massively raise income taxes. But that was shot down, as people revealed their true colours that they simply dont like paying tax, to them its all about themselves and not society.

For me I work to provide for myself yes, but I also work to provide for the country. Anyone who thinks otherwise I think is selfish. I personally think I am massively undertaxed, I would happily pay another 10% in income tax.

There is individuals I know who would rather spend more money than they would pay otherwise just to avoid tax, its all crazy. People are so obsessed with tax its unreal.

Yes and the Labour manifesto really epitomised this selfishness - "we'll massively raise public spending but someone else will pay for it - we won't raise taxes on you" (unless you're on the top 5%).

The IFS shot their figures to bits and pointed out that the only way they'd achieve the spending increases they want is to raise taxes on ordinary people, but of course people are too selfish to vote for that so they didn't propose it.

Keep_pedalling wrote: »

We did not pay any tax on much of the nearly £400k we have sitting in our ISAs as some of it was inherited, and some of it has come from capital gains within the ISA and from the transfer of other gains that have been transfered to it through annual bed and ISA which we can now due to the tune of £40k a year, something the vast majority of people could not possibly benefit from

There's a point re the capital gain within the ISA, which is the main tax break of an ISA for basic rate taxpayers.

But the other stuff - inheritance is subject to IHT, bed and ISA is subject to CGT. Of course the amounts could be within the respective allowances, but that's an issue with IHT and CGT, not ISAs.

If you shove an inheritance into an ISA rather than spending it on a world cruise I don't see why you should more tax it (ie the initial capital - as above I take the point about capital gains).

2 thirds of the amount of savings held in ISA are still cash, and I am willing to bet that most of that is with the smaller savers who have yet to figure out what a waste of time that is. The large uplift in annual ISA allowances, and the pathetic interest rates that can be earned within cash ISA have shifted the benefits offered by ISAs have deffinately moved to favour the more well off, knowledgable investors like us.

Well yes so why consider taxing the pathetic amount of interest earned by cash ISAs when they almost certainly don't even keep up with inflation?

ISAs also provide simplicity. No need to keep records, have to declare dividends, interest or capital gains on tax returns, tax credits, student loan applications etc.