Take advantage of £20,000 tax efficient savings before April 5th

There is still time take advantage of £20,000 tax efficient savings by investing into an ISA before the 2017/18 tax year end. 

Building up an Individual Savings Account (ISA) portfolio can provide tax efficient savings and be a very effective addition to your savings planning, including potentially a good addition to your future retirement pot, as regular withdrawals can be made to provide additional income tax free.

Scott Herbert, Partner and IFA, Clarke Nicklin Financial Planning, shares his Expert Opinion 

Each tax year we are allocated an annual allowance of which we can invest into an ISA, the current limit is £20,000 and the deadline to add to your account for 2017/18 is 5 April 2018.

There are many variations of ISAs now offered over and above cash, and stocks and shares, all of which provide tax efficient savings and some of which give decent incentives: –

Help to Buy ISA – To help first-time buyers over 18 get on the property ladder.  You can start with a lump sum deposit of up to £1,200, then save up to £200 a month. For every £200 you save, the Government will add 25% up to a maximum bonus of £3,000. It’s available per buyer, not household, so if you are saving with a partner, the bonus potential is up to £6,000 towards your house deposit.

Lifetime ISA – Designed for your first home or retirement, it allows you to save up to £4,000 annually to receive a 25% government bonus. You are only allowed to invest into a LISA between the age of 18-39. You must buy a home for £450,000 or less, or to withdraw the cash for retirement you must be 60 plus.

Junior ISA – Cash or investments can be wrapped in this ISA on behalf of children under the age of 18. The Junior ISA has an annual allowance of £4,128 increasing to £4,260 in 2018/19.

Whatever your age or personal situation, it is vital to consider your saving strategy as early as possible, and reassess regularly on an ongoing basis. Any savings plan needs to be specific to personal circumstances and objectives, and needs linking to all aspects of your personal finances. It is important that your own personal circumstances are assessed in detail to arrive at a savings strategy that meets personal objectives.

If you would like to find out more, please contact Kathryn Arnold for an appointment

Information is based on our current understanding of taxation legislation and regulations. Any levels and bases of, and reliefs from, taxation are subject to change. The value of investments and income from them may go down. You may not get back the original amount invested. Past performance is not a reliable indicator of future performance.