Foreigner entitled to ISA?

tokyophil

Hi,

I'm a little confused by how an ISA works. I have one myself but my girlfriend also wants to take one out. She is Japanese and has been here for 10 months on a student visa. She has worked either part or full time for all that period, alongside her studies (And pays tax on her earnings)

Therefore, can she take out an ISA - and would she benefit from this? Or would her normal savings be tax free?

Thanks

Phil

cocktail

tokyophil wrote: »

Hi,

I'm a little confused by how an ISA works. I have one myself but my girlfriend also wants to take one out. She is Japanese and has been here for 10 months on a student visa. She has worked either part or full time for all that period, alongside her studies (And pays tax on her earnings)

Therefore, can she take out an ISA - and would she benefit from this? Or would her normal savings be tax free?

Thanks

Phil

she can take out an ISA as she is resident.
u said that she pays tax on her earnings , so i presume she earns above the tax threshold. income from savings is taxed so yes she will benefit from the ISA's tax free status.

Aegis

If she has a National Insurance number she can have an ISA. It's a good general rule!

tokyophil

Cheers - good to confirm that :-)

Cook_County

I disagree. She has to be Ordinarily Resident in the UK. If she is a student here on a temporary basis, this is extremely unlikely. http://www.hmrc.gov.uk/leaflets/isa-factsheet.htm

Why does she want one though? Unless the income will be greater than £2,000 a year she can keep her savings outside the UK (as she is not domiciled here) and pay zero UK tax?

tokyophil

Japanese savings rate were less than 0.5% at their peak before the financial crisis - makes sense to leave them here and earn some interest.

Will see what the bank says about her ISA - best way to find out!

agsnu

tokyophil wrote: »

Japanese savings rate were less than 0.5% at their peak before the financial crisis - makes sense to leave them here and earn some interest.

Ah, but if you moved your Japanese savings in Yen to a Sterling account paying 5% before the financial crisis, they'd probably still be worth at least 30% less....

http://finance.yahoo.com/echarts?s=GBPJPY=X#chart1:symbol=gbpjpy=x;range=1y;indicator=volume;charttype=line;crosshair=on;ohlcvalues=0;logscale=on;source=undefined

tokyophil

Fair point, but not sure if the rate will drop much worse than it is now. Planning to leave them in an account for a while so hopefully the markets will have stabilized a bit by then....

Also, we're planning on staying in this country so ultimatley need the money here