ISA

Q. What is an ISA?

A. An ISA (Individual Savings Account) offers a 'tax advantageous' way to grow your money and can be an important feature in many of today's investment portfolios. Investments in ISAs are not subject to capital gains tax and no higher rate income tax is payable on dividends received.

Q. How much can I subscribe to an ISA?

A. For 2019/2020 up to £20,000 may be subscribed.

Q. Who is eligible to subscribe to a stocks & shares ISA?

A. Individuals over the age of 18 resident in the UK. UK Government employees living abroad, or their spouse/civil partner can also subscribe.

Q. Can I subscribe to more than one ISA?

A. You can subscribe to one stocks & shares ISA and one cash ISA in any tax year and your annual allowance of £20,000 can be invested in any combination of stocks & shares and/or cash (either with the same or different provider). Speirs & Jeffrey does not offer cash ISAs which are traditionally provided by banks and building societies.

Q. Can I transfer my ISA from another manager?

A. Yes, we can accept transfers of all ISAs, including cash ISAs. Speirs & Jeffrey can arrange the transfer process without you needing to contact your existing provider. We do not charge to transfer ISAs from another provider.

Q. What is “Flexible ISA”

A. From 6 April 2016, investors can withdraw funds from an ISA and, provided this is replaced in the ISA before the end of the same tax year, this won’t affect your annual allowance. Previously, any funds withdrawn and subsequently replaced would count towards your annual allowance.

Q. What if I exceed my annual ISA limit?

A. HMRC recognises that this can happen accidentally. If you believe you may have oversubscribed, HMRC will contact you to advise any action necessary.

Q. What other tax benefits do ISAs have?

A. Inheritance tax benefits: Since April 2015 surviving spouses, or those within civil partnerships, can now inherit an ISA allowance on death. The spouse who inherits the ISA will be given an additional, one-off ISA allowance equal to the value of the deceased's ISA holdings. This enables them to re-shelter assets which were in a spouse's ISA into an ISA in their own name. Please contact S&J for further information.

Income tax advantages:   Currently all investors have a £5,000 tax-free dividend allowance. Dividend income over and above this will be taxed at 7.5% for basic rate taxpayers, 32.5% for higher rate taxpayers, and 38.1% for additional rate taxpayers.  However, dividends and bond interest received in ISAs continue to avoid any further tax hence there is potentially greater benefit from sheltering taxable income within an ISA. Please note the tax-free dividend allowance for shareholders will be reduced from £5,000 to £2,000 from April 2018.  

Q. When are ISA statements issued?

A. Statements are issued shortly after 6 April and 30 September each year.

Q. I have been asked to send/bring in money laundering documentation, what do I need to bring?

A. You need one of the following documents: current passport, photocard driving licence or firearms certificate. If you cannot provide one of these documents you will need to provide alternative proof of both identity and address. Please telephone us so that we can help you to identify acceptable documents. Please note that photocopies of documents are not acceptable unless they are certified (see answer to next question).

Q. What does a certified copy mean (in relation to money laundering)?

A. A certified copy means a photocopy which is signed by a third party who is not a direct relative. The third party must be a professional person (e.g. lawyer, accountant, post master/sub-master, banker, teacher, minister, doctor, etc.).The third party must have seen the original and must write above their signature that the copy is a true replica of the original and (if applicable) that the photograph bears a true likeness. They must state their capacity, contact details and the date of signature.

Q. Why do I need to provide documentation?

A. Alas, this is a regulatory requirement with which we must comply. However well we know you, there is no escape from this and everyone is subject to the same requirement.

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