11th January 2023
Your ISAQuestions Answered 4-8
Q: CAN I GET A LIFETIME ISA?
A: If you are between the ages of 18 and 39, you can open a Lifetime ISA. A Lifetime ISA can be used to purchase your first home or to save for retirement. You can contribute up to £4,000 per year until you reach the age of 50. The government will add a 25% bonus to your savings up to a maximum of £1,000 per year.
WHAT IS AN INNOVATIVE FINANCE ISA?
A: An Innovative Finance ISA allows people to use part or all of their annual ISA allowance to lend money through the peer-to-peer lending market. Individuals and businesses can borrow money directly from lenders through peer-to-peer lending. In an Innovative Finance ISA, your capital and interest may be at risk, and your investment is not protected by the Financial Services Compensation Scheme.
Q: WHAT IS A JUNIOR ISA?
A: This is a vehicle for saving and investing for children under the age of 18. It is a tax-efficient way to save or invest because the proceeds are exempt from Income Tax, Dividend Tax, and Capital Gains Tax. For the tax year 2022/23, the Junior ISA subscription limit is currently £9,000.
Q: IS TAX PAYABLE ON ISA DIVIDEND INCOME?
A: Dividend income is exempt from taxation. Any dividends paid inside your ISA are tax-free.
Q: DO I HAVE TO PAY CAPITAL GAINS TAX (CGT) ON MY ISA INVESTMENT GAINS?
A: You are not required to pay CGT on profits.
Visit us again tomorrow as we explore what you can do or contact Woodward Markwell for further information.