Tax implications for ISAs if Scotland becomes independent

feijoa

Apologies if this has been covered elsewhere. I am domiciled in Scotland and hold ISAs in United Kingdom building society accounts. If Scotland votes for independence, thus becoming a foreign country, will I be able to retain my ISAs - and will they still be sheltered from tax? Will I be allowed to add to the funds in my existing ISAs - or open new ones? Technically those of us with Scottish domicile will no longer be UK tax payers and this will surely have implications for holders of such investments.
Presumably independence will also have implications for non-taxpaying Scottish-domiciled savers who are currently registered to receive their savings interest gross. I raised these questions with my building society the other day - and the answer seems to be that nobody knows what might happen post independence.
It's about time that Government sets out the facts/policy and provides some answers before the referendum. It's an absolute can of worms!

ColdIron

Tax breaks, such as Isas are offered by the UK Government to its own nationals and according to UK tax law. These cannot exist in a foreign country, as Scotland would become. There is no reason that a new Scottish government could not introduce them of course

The position of the UK government is clear, if anyone needs to set out the facts/policy and provides some answers before the referendum that would be Alex Salmond and the Nationalists but they are a bit long on talk and short on facts

Archi_Bald

Wouldn't all Scots be so rich once they are independent that they wouldn't need to worry about "ridiculous" details such as taxes on savings? ("ridiculous" being Nicola Sturgeon's way of trying to brush away anything she has no answers to).

feijoa, as and if there will be independence, it will take considerable time to sort out a huge array of stuff, so nothing will change in the short term. It is probably safe to assume that in general, no tax breaks will be available to people who are not UK residents for tax purposes.

grey_gym_sock

i'm struggling to see a problem with this 1 ...

i pretty sure both countries would want to keep ISAs. you would probably need to hold your ISAs in the country you're living in, which might require a transfer. but most major providers would be setting up (if they don't already have it) operating companies in both countries. so they could handle any transfer internally. and there'd be at least 18 months to sort this out.

though the vote will be no, anyway ...

Andyt1981

You would have until 26th March 2016 to worry about it anyway.

feijoa

Many thanks to all who have replied. I quite agree that it is Alex Salmond who needs to be answering the many queries we all have relating to financial matters, should Scotland vote for independence.

I find it staggering that whenever genuine concerns re money matters are raised, those who raise them are accused of scare-mongering - that "Scotland's oil" will meet all of Scotland's future financial needs and spending. In view of the unequivocal declaration of the "three chancellors" with regard to there being no currency union with an independent Scotland, the prospect of a gigantic leap into the financial unknown is scary in the extreme!


The SNP's only response to the currency union discussion is to keep trotting out the tired old mantra of "bluff, bluster and bullying" on the part of the UK government - insisting that rUK will agree to a currency union in its own interests. With an increasingly irritated rUK electorate and a general election coming up next May? Yeah, right!

innovate

I agree with you, a yes vote is a vote for years, if not decades, of uncertainty. I am sure the vast majority of those who are allowed to vote will not want to subject themselves and their children to this. The UK isn't a perfect country, but a heck of a lot better than some others I could mention, and no country will ever be perfect. A country created by a couple of people with an ego the size of the universe but no answers to the day-to-day practical aspects is a truly scary prospect.

Better the devil you know, as they say.

PS. Whatever happened to that maniac Fred who had decided it would be great to rule the banking world from his office in Edinburgh, and in the process almost bankrupted the UK? Seems there is something in the air up there that doesn't become some middle-aged men.

zagubov

feijoa wrote: »

Many thanks to all who have replied. I quite agree that it is Alex Salmond who needs to be answering the many queries we all have relating to financial matters, should Scotland vote for independence.

Actually this article seems to suggest it's Westminster who aren't thinking about what happens next

feijoa wrote: »

I find it staggering that whenever genuine concerns re money matters are raised, those who raise them are accused of scare-mongering - that "Scotland's oil" will meet all of Scotland's future financial needs and spending. In view of the unequivocal declaration of the "three chancellors" with regard to there being no currency union with an independent Scotland, the prospect of a gigantic leap into the financial unknown is scary in the extreme!

This fella explains why the currency union will happen more eloquently than I could.

As regards the three chancellors. Three untrustworthy idiots saying the same nonsensical statement doesn't make it any truer.

feijoa wrote: »

The SNP's only response to the currency union discussion is to keep trotting out the tired old mantra of "bluff, bluster and bullying" on the part of the UK government - insisting that rUK will agree to a currency union in its own interests. With an increasingly irritated rUK electorate and a general election coming up next May? Yeah, right!

I live in the rUK. People down here are barely aware this is happening.

innovate

zagubov wrote: »

As regards the three chancellors. Three untrustworthy idiots saying the same nonsensical statement doesn't make it any truer.

.

Using abusive language, and regurgitating popular SNP words like nonsensical and ridiculous don't add much to a reasoned and factual debate. I do concede, however, that it probably appeals to people who haven't really sat back and looked at the practical implications.

rUK will be able to govern itself, like an independent Scotland would. We would not have to share our currency with anyone, and we have said we wouldn't share it with an independent Scotland. Scotland cannot force rUK to do something rUK wouldn't want to do, like rUK wouldn't force another nation to do what they don't want to do.

People like feljoa have a lot of questions to which the Nats have no answers right now, just sweeping insults involving the words nonsensical and ridiculous. And assertions that some of the interests of an independent Scotland would be in the interest of rUK, such as a currency union without a fiscal union. I should suggest that Alex and Nicola and the rest of the Nats refrain from making any comments on what is in the interest of rUK and instead focus on answering the questions the people of their envisaged independent state need to have answered.

zagubov

innovate wrote: »

Using abusive language, and regurgitating popular SNP words like nonsensical and ridiculous don't add much to a reasoned and factual debate. I do concede, however, that it probably appeals to people who haven't really sat back and looked at the practical implications.

rUK will be able to govern itself, like an independent Scotland would. We would not have to share our currency with anyone, and we have said we wouldn't share it with an independent Scotland. Scotland cannot force rUK to do something rUK wouldn't want to do, like rUK wouldn't force another nation to do what they don't want to do.

People like feljoa have a lot of questions to which the Nats have no answers right now, just sweeping insults involving the words nonsensical and ridiculous. And assertions that some of the interests of an independent Scotland would be in the interest of rUK, such as a currency union without a fiscal union. I should suggest that Alex and Nicola and the rest of the Nats refrain from making any comments on what is in the interest of rUK and instead focus on answering the questions the people of their envisaged independent state need to have answered.

I am sorry you regarded aspects of my post as abusive. I had no intention to malign posters on this board (and I apologise unreservedly if that was the preceived outcome of my post) and if the the three finance experts are likely to shed a tear at what an anonymous poster on a moneysaving site says about them they are singularly and collectively not cut out for political careers. They are arguing, thankfully very unconvincingly, for a policy that will cost the rUK very many jobs.

I wonder if you followed my links and digested their contents. They may offer another side to the endless negativity which you're exposed to in the wider media and which seems to pass for neutral reporting in this fascinating time. And help explain where the problems lay with the banking system that you think is based in Edinburgh.

I hope the Westminster government changes its rule about starting negotations early, so we can all fill in the gaps in our knowledge.

feijoa

The consequences of a vote for Scottish independence will be far-reaching for everyone in Scotland - and for many in the rest of the United Kingdom as well. Innovate makes the excellent point that the outcome of September's referendum will affect the future of our children and many generations to come. It is an issue which transcends party politics. We have been told - from the outset - that a vote for independence is irreversible.









Failing to lay before the Scottish electorate all the facts, positive and negative, relating to such a momentous decision is surely a dereliction of duty. And while I don't pretend to know all the ins and outs of the economics of trade and of the business world, I do know that what concerns the ordinary men and women in the streets of Scotland is how they and their families will fare in an independent Scotland. Crucial to this is what happens to their personal finances. While this may seem unimportant in the grand scheme of things, it is matters such as these - the minutiae of daily life - which preoccupies many of us.



I believe that instead of trying to score political points, both the Scottish and Westminster governments need to address these issues urgently and honestly. It is ridiculous for Alex Salmond and Nicola Sturgeon to insist that there will be a currency union, come what may - when Westminster has stated, repeatedly, that this will not happen. My opinion, or for that matter anyone else's, of the three chancellors' trustworthiness and integrity is beside the point. And I would be the first to say that both Westminster and Holyrood are far from perfect! However, I would not want to take a punt on whether or not the three of them are all bluffing re their stance on currency union. Come the general election in May 2015, the rUK elctorate will hold all three main parties to their promise of no currency union with an independent Scotland. So - having no 'plan B' re currency amply demonstrates the SNP's penchant for behaving in a head-in-the-sand manner when confronted with issues to which it does not wish to face.





And while it may be true that some in the rUK, as zagubov states, are barely aware this is happening - many of our friends and family in England are as troubled about the possible break-up of the union as we are. Sadly, others in rUK are seriously hacked off with Alex Salmond's constant belittling of the English. Hardly the way to win friends - or to keep those we already have.