ISA tax rules explained
It’s well known that ISAs allow individuals to save money free of income and capital gains tax.
But the tax rules are surprisingly misunderstood, according to recent research by Opinium. So NWN is happy to offer some clarity.
The key elements to ISA tax rules are as follows:
- The ISA annual allowance is £20,000 for 2017/18
- You can transfer money from previous tax years into a current ISA
The annual £20,000 allowance covers each type of ISA including cash, stocks and shares, Lifetime, innovative finance and Help to Buy. ISA rules allow people to split the allowance between different types of ISA.
*Lifetime ISAs and Help to Buy ISAs both count towards the £20,000 threshold.
Some ISAs are flexible allowing you to take money out and put it back in during the same tax year without it affecting your allowance. You can transfer savings between providers and into different types of ISA. However, if you want to transfer money deposited in the current tax year you must transfer it all.
If you’re thinking about moving money into or out of ISAs and you’re not sure of the rules, contact NWNBlueSquared for some sound advice.