Reeves' ISA review

gt94sss2

I wonder how any changes would impact the ability to transfer between different types of ISAs.

Area88

I hope any idea to reduce the isa allowance gets reversed. I am 100% dependant on ISAs for my savings. I don’t use any other products. I really hope the backlash is gigantic. We can’t be paying tax in every single direction.

1983Butlins

With the latest comment about the cash Isa being reduced to possibly only £4 k a year aloud. This again can be deemed as another hit on pensioners as to invest in a tracker Isa and is not recommended, this is because most Financial Advisers recommend this should be done over a ten year investment, because the amount can go up and down but overall should make more money, so someone in their seventies onwards are not going to invest In Tracker Isa's.  All Reeves can see is money in the banks that she can tap into. This idea is great for younger people or rich investors and like someone has commented already it's leaving the door open to scammers. What she's got to remember is pensioners have saved,saved,saved over the years for that safety nest egg in the banks for that "what if happens",  all they mostly have is their pension, as it was they could put any extra cash tax free, where Reeves is making it that she will be in a position to gain more tax from people via normal accounts etc, as older people are not as savvy. I feel that what the Government is doing is wrong.

Rusty190

If the purpose of these proposals is to encourage investments to benefit business and the UK, why did they scrap the plan to have an extra £5K UK S&S ISA allowance?

That idea may have encouraged the more tentative among us, to have a punt! 

SVaz

Unless they somehow prohibit buying a short term money market fund within S+ S ISAs, which I don’t see how they can,  it’s a very easy work around .  

All it will take is Martin to publicise it on his show if the reduction happens.  It would be a nice ‘!!!!!! you’ to the Goverment. 

daveyjp

One option is to Introduce a maximum amount which can be held in ISAs of any flavour. 

masonic

SVaz said:

Unless they somehow prohibit buying a short term money market fund within S+ S ISAs, which I don’t see how they can,  it’s a very easy work around .  

All it will take is Martin to publicise it on his show if the reduction happens.  It would be a nice ‘!!!!!! you’ to the Goverment. 

If they do push ahead, then to make it effective, they'd need to return to the system where the lowest risk investments aren't ISA eligible. If HMRC removed eligibility, as they do from time to time with various investments, then investors would have their platform contact them to choose whether to have the investment removed from the ISA wrapper or sold within the ISA.

They would not have an easy workaround for people buying individual low coupon gilts unwrapped and holding to maturity for a tax exempt capital gain. Though that might help reduce the cost of borrowing, as would a new issue of Index Linked Savings Certificates.

2010

https://www.telegraph.co.uk/money/investing/isas/rachel-reeves-announce-cash-isa-cut/

jimjames

Area88 said:

I hope any idea to reduce the isa allowance gets reversed. I am 100% dependant on ISAs for my savings. I don’t use any other products. I really hope the backlash is gigantic. We can’t be paying tax in every single direction.

Prior to the tax changes on savings and increase in ISA limits you would likely have been paying tax. Current limits are very generous.

daveyjp said:

One option is to Introduce a maximum amount which can be held in ISAs of any flavour. 

Not sure how that could work. Maybe a limit on the amount paid in but with S&S ISAs growth could easily exceed the max when some have over a £1m in ISAs.

Exodi

2010 said:

https://www.telegraph.co.uk/money/investing/isas/rachel-reeves-announce-cash-isa-cut/

My colleague showed me this yesterday without reading the article - the URL is somewhat misleading, there are no announcements in that thread, just speculation of what she may do in the coming weeks (of which there is already an abundance of that).

I think most people have seen the widespread speculation that the Cash ISA allowance will be cut to £4k (and I'd imagine it is likely to happen for the next tax year). The simplest answer to those that do not to invest is SSTMMF's, as has been mentioned in this thread.

Personally, I think the cynical take that the government is doing this to cause some people to save into taxable savings accounts is correct, as it doesn't really help the country or the government having a new wave of novice investors googling what investments have returned the most and then dumping all of their money into the S&P500, as we usually see happen.