Limits on S&S ISA

sorcerer

I am a bit confused about a couple of things, if I may "income" inside a stocks and shares ISA, does this count towards my £10,000 limit before i have declare it for the purpose of self assessment.

Also if the limit takes me into the 40% tax bracket would I have to declare it then, even if below the £10,000 limit.

Any clues?, it's not very clear on the HMRC website about this.

Linton

sorcerer wrote: »

I am a bit confused about a couple of things, if I may "income" inside a stocks and shares ISA, does this count towards my £10,000 limit before i have declare it for the purpose of self assessment.

Also if the limit takes me into the 40% tax bracket would I have to declare it then, even if below the £10,000 limit.

Any clues?, it's not very clear on the HMRC website about this.

Any money gained from investments in an ISA stays in the ISA. The £11280 (not £10000) limit is only for new money. Once money is in an ISA it is completely outside the tax system - it has no effect on your tax bands.

sorcerer

sorry i mean't HMRC have a maximum total of £10,000 from savings and investments, but you need to tell them about it, for the purpose of self assement.

I am refereing to this webpage - http://www.hmrc.gov.uk/sa/need-tax-return.htm

Where it says the following

Income above a certain level from savings, investment or property

If you don't already complete a tax return, you'll need to do so if you receive any of the following:

• £10,000 or more income from savings and investments
• £2,500 or more income from untaxed savings and investments
• £10,000 or more income from property (before deducting allowable expenses)
• £2,500 or more income from property (after deducting allowable expenses)
• annual trust or settlement income on which tax is still due (even if you’re only treated as receiving this income)
• income from the estate of a deceased person on which tax is still due

Linton

Money in an ISA it doesnt count for HMRC purposes.

noh

Income of any amount received within an ISA does not have to be declared. Nor does the income received count towards the £10K threshold detailed in your post.

http://www.hmrc.gov.uk/isa/faqs.htm#10

sorcerer

Great so for example if I make £7000 from normal savings account, £2000 from Cash ISA and £2000 from stock and shares ISA, I wouldn't need to tell them about this, because my total income is £7000 for HMRC purposes and not £11,000?

Assuming that I have paid tax on all of the £7000.

sorcerer

noh wrote: »

Income of any amount received within an ISA does not have to be declared. Nor does the income received count towards the £10K threshold detailed in your post.

http://www.hmrc.gov.uk/isa/faqs.htm#10

Great, that's what I needed to know, thanks so much. I just wanted to make sure I wasn't doing anything wrong. I like to keep on the right side of HMRC! :A