The end of the 2020/21 tax year will soon be upon us. Since April 5 is right around the corner, it means that if you’re planning to use this year’s ISA allowance you need to act fast.
This does not constitute advice and advice should be sought in all instances before acting on it.
Individual Savings Accounts (ISAs) are one of the most straightforward ways to achieve tax-efficient gains. Investing in an ISA is a great addition to your existing portfolio. Or it could simply help kickstart your saving and investing plans. But remember, there’s no rollover from one tax year to the next with your ISA allowance.
Here are a few ways to help make the most of the savings opportunities available before the tax year ends.
You can have more than one ISA
Even though your total ISA allowance cannot exceed £20,000, you can spread that across the various types. How you decide to split your allowance between Cash ISAs, Stocks & Shares ISAs, and Innovative Finances ISA is up to you. It will all depend on what your investment goals are and how long you want your money stashed away.
Other types of ISAs
Apart from the three main ISA types, there are additional avenues designed to help you save.
A Help to Buy ISA is a government scheme that helps people save for a house deposit. You get a bonus 25% added by the government, up to a maximum of £3,000 on a savings of £12,000. This, however, does count toward your Cash ISA allowance. And unfortunately you can’t open a new one anymore; you can only continue to save in the one you already have.
Lifetime ISAs are available to people aged between 18 and 39 and can be used to buy your first home or save for later on in life. Each year, you can save up to £4,000 until you reach the age of 50. This ISA also benefits from a 25% bonus to your savings courtesy of the government, up to a maximum of £1,000 per year.
Junior ISAs are for children up to the age of 18 and are a handy way to save or invest that helps avoid Income Tax, tax on dividends and Capital Gains Tax on the proceeds. For this tax year, Junior ISA limits are £9,000.
Act fast
As you know, your ISA allowance expires at the end of every tax year. To avoid a last minute scramble, get in touch with us today. Our specialist advisers can help you figure out where and how to invest your money, but you’ll need to act now to ensure everything is sorted before the deadline.
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