Making the most of your 2015-2016 ISA allowance
Plant an ISA and let nature take its course.
That's the message from the team of investors at James Sharp & Co as the deadline for using this year's allowance approaches.
James Sharp offers Self-Select ISAs and Junior ISAs with a choice of investments including any UK or foreign company listed on a recognised stock exchange, or any fund or investment trust which meets the ISA rules.
Steve Ross, Investment Dealer and Adviser says it is important to take the long view when it comes to ISAs. "If you combine disciplined contributions with the tax sheltering benefits, then the results can be considerable. It's enabled some of our clients to use their ISA as a supplementary income in retirement.
"I like to use the analogy of planting a tree. You don't dig it up after two weeks to see if it has grown, nor do you chop it down in winter because the leaves have fallen off, it's a long term process and you let nature take its course," Steve explained.
New flexibility for Stocks and Shares ISAs
New flexibility for Stocks and Shares ISAs starts in April 2016 enabling savers to access their ISA cash without losing any benefits.
Investors will be able to withdraw and replace money from their ISA without it counting towards their annual ISA limit for that year, as long as the repayment is made in the same tax year as the withdrawal.
James Sharp & Co is actively looking to offer this service as an extension of its current Self-Select ISA service and will provide a further update shortly.
ISAs - What you need to know
- ISA deadline for the tax year 2015/16 is at our close of business on 5th April 2016. The new tax year starts on 6th April 2016.
- Invest the full amount (up to £15,240) in either a Stocks & Shares ISA or a Cash ISA; alternatively split the amount between both types. The 2016/2017 ISA allowance is the same as the 2015/16 year.
- The annual ISA allowance is per individual. A couple can put up to £30,480 between them into ISAs in this tax year.
- Changes to ISA rules in April 2015 meant that surviving spouses, or those within civil partnerships, can now inherit an ISA allowance on death.
- You may be entitled to Additional Permitted Subscriptions (APS) if your spouse or civil partner dies. This is equal to the value of your deceased spouse's ISAs and enables you to invest this money tax-efficiently in addition to your own allowance.
Such Additional Permitted Subscriptions are only available for a limited time period relating to your spouse's estate. If your spouse's ISA was held with James Sharp & Co, you can open a new ISA with us to use your APS. Where you inherit ISA assets, these can be transferred into your new ISA (subject to market value), or you can fund the APS with your own cash. Even if your spouse's ISA was held elsewhere, you can open a new ISA with James Sharp & Co to use your APS, however you will only be able to make cash subscriptions.
Please be aware tax treatment depends on individual circumstances and are often subject to change. Please consult an appropriately qualified professional before making any decisions on an ISA or other tax related product