Budget Update – ISAs

The annual ISA subscription will increase from £10,200 to £10,600 from 6 April 2011 (of which half can be invested in a cash ISA).

More interestingly, it is anticipated that Junior ISAs will be available from autumn 2011 for any UK-resident child who is under the age of 18 and who does not currently hold a Child Trust Fund. As with existing ISA products, junior ISAs will benefit from tax relief on income and gains and will be available as a cash or stock and shares product.

Their introduction will provide parents with an opportunity to save for their children’s future in a tax efficient manner. The accounts will be operated and managed by the person with parental responsibility for the child (normally the child’s parent or guardian). Draft legislation with further details is anticipated by the end of this month.

Duncan R Glassey
Senior Partner – Wealthflow LLP

duncan.glassey@wealthflow.com

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