{"id":18866,"date":"2019-02-14T12:53:57","date_gmt":"2019-02-14T12:53:57","guid":{"rendered":"https:\/\/smh.group\/?p=18866"},"modified":"2023-02-15T13:50:36","modified_gmt":"2023-02-15T13:50:36","slug":"happy-birthday-to-tax-free-savings","status":"publish","type":"post","link":"https:\/\/devstagesite.co.uk\/smhgroup\/happy-birthday-to-tax-free-savings\/","title":{"rendered":"Happy birthday to tax-free savings"},"content":{"rendered":"

The arrival of the new tax year on 6 April means it is time to consider your Individual Savings Accounts (ISA) investments, which will celebrate their 20th<\/sup> birthday in April.<\/h3>\n

Over the last 20 years, the maximum annual contribution has risen from \u00a37,000 per tax year to \u00a320,000 for 2019\/20. If you managed to set aside the maximum each tax year since 1999\/2000, you would now have placed over \u00a3205,000 into ISAs and largely out of HMRC\u2019s reach.<\/p>\n

The relatively simple single investment option has also morphed into a range of plans covering everything from retirement planning (the Lifetime ISA) to children\u2019s saving (the Junior ISA).<\/p>\n

However, one aspect has been common throughout the ISA\u2019s lifetime: new investment is concentrated at the end of the tax year. For example, in the 2017 calendar year Investment Association data shows that net ISA investment in the second quarter was \u00a31,421 million against a net total of \u00a31,068 million for the entire year (the first and fourth quarter showed net outflows).<\/p>\n

This means, if you are in that \u2018leave-it-until-the-last-moment\u2019 majority, now is the time to start thinking about your 2018\/19 ISA investment.<\/p>\n

The benefits of ISAs<\/strong><\/h3>\n

Whilst the value of ISAs has changed over 20 years, as successive Chancellors have altered the tax treatment of interest, dividends and capital gains, the main tax advantages are largely unchanged:<\/p>\n