ISA allowance 2020/21

AlBlanco

Whats the concencus of opinion.. is the allowance going to stay at £20k or might the chancellor up it a bit to encourage investment? Suppose weve got to wait until the budget tp know for sure!

Alexland

My guess is the adult allowance will be unchanged and the junior allowance will be inflation uplifted again. This is hardly on the government priority list.

masonic

The new chancellor will be under a lot of pressure not to break the manifesto pledge not to raise income tax, national insurance or VAT. So with the pressure to increase spending while simultaneously eliminating the deficit, there will likely be no scope to give away any additional tax breaks in the foreseeable future.

AlBlanco

Looking at this purely from a cynical angle l was thinking along the lines MPs have given themselves mind boggling pay rises and the House of Lords have upped their expenses so it is the likes of them and the the well off that can afford to invest £20k a year every year so it would be advantageous for them to increase it?

masonic

AlBlanco said:

Looking at this purely from a cynical angle l was thinking along the lines MPs have given themselves mind boggling pay rises and the House of Lords have upped their expenses so it is the likes of them and the the well off that can afford to invest £20k a year every year so it would be advantageous for them to increase it?

I expect they find more effective ways to line their own pockets than making use of their ISA allowance.

AlBlanco

Ha ha yes.. but l bet they fully invest in an ISA every year plus prob also have one in wife/husbands name lol

masonic

AlBlanco said:

Ha ha yes.. but l bet they fully invest in an ISA every year plus prob also have one in wife/husbands name lol

Not all investments are ISA eligible (e.g. rental properties, direct private equity holdings, some offshore investments, investments in your own companies), and some already give some lucrative tax breaks (e.g. VCTs / EIS) as well as being tax free. There are also other ways to hold assets outside of the reaches of HMRC. The priorities of the most wealthy in society will differ from those of more modest means.