End of tax year reminder
– use it
or lose it
With the tax year end fast
approaching, now might be
a good time to review your
investments and ensure
you’re making the most of the tax
breaks available to you.
Your ISA allowance
The ISA allowance increases in line with the Consumer
Prices Index (CPI) each year. For this tax year, which
ends on 5 April 2012, the ISA limit is £10,680 of
which a maximum of £5,340 can be held in a Cash
ISA. This year’s Junior ISA limit is £3,600, and will
remain at £3,600 until April 2013 after which it will
rise in line with the CPI each year. Also, from 6 April
2012, the ISA allowance will rise to £11,280 of
which the maximum you can hold in cash element
will be £5,640.
Whilst there is a limit on the amount that you can
invest each year, the key point to remember is that,
regardless of how long you hold your ISA, there
is no tax to pay on any growth and no additional
tax to pay on income received. When it comes to
withdrawing from your ISA, any gains are free from
Capital Gains Tax. Remember, with each new tax year, you have the opportunity to add more into an ISA. With an
ISA from Alliance Trust Savings, as long as you subscribe each year,
there is no requirement to complete a new ISA application form for
each new tax year. We keep it simple, to make your life easier.
Consolidate to accumulate
If you already hold ISAs from previous years, the impact of
ongoing charges and the way in which your portfolio is diversified
is even more important. It may be appropriate to consider
consolidating your ISAs with the one company. This will reduce
the volume of paperwork you receive and you’ll benefit from
receiving a single valuation for all of your holdings, which
will allow you to manage your portfolio more effectively.
1. All growth within an ISA is tax free and there is no additional
tax on income. Sale of assets and withdrawals will not incur
capital gains tax.
2. You can invest up to £10,680 in the current tax year, but if you
don’t use it, it will be lost forever.
3. Diversify your portfolio and spread your investment across a
range of sectors.
4. Consolidate your ISAs with the one provider and significantly
cut costs and reduce paperwork. With Alliance Trust Savings,
you can manage all of your investments online.
5. If you have any questions about ISAs or other investments you
should seek professional advice.
For full information about our ISAs, please visit our website.
This newsletter is prepared for general information only. Nothing in it should be taken as an offer, invitation or inducement to engage
in investment activity. Alliance Trust does not give financial advice. Please remember the value of investments and any income from
them can go up or down and you may not get back the amount you invested. All investments carry an element of risk, which may
differ significantly, and if you are unsure as to the suitability of any particular investments, you should seek professional financial advice.
Foreign markets will involve different risks than UK markets, in some cases the risks will be greater. The potential for profit or loss from
transactions on foreign markets or in foreign currency denominated marketswill be affected by fluctuations in foreign exchange rates.
We do not give advice and the inclusion of particular stock names is not intended as a recommendation. You should remember that the
amount of tax relief depends on your individual circumstances and that the beneficial tax treatment of ISAs may not continue in the
future. Information relevant to 2011/12 tax year unless otherwise stated.
This information is based on our understanding of current tax law and HM Revenue & Customs (HMRC) rules. Legislation and tax
regulations are not guaranteed and can change at any time. Current tax advantages may change and could be withdrawn; tax rates
and reliefs may change and depend on individual circumstances.