ISA content
Thu, 07/02/2008 - 20:41
This depends on your tax position.
Don't forget that the dividend income from shares is still taxed at 10% basic rate within an ISA whereas cash interest is completely tax free. So if you are a basic rate taxpayer who is only concerned about income tax you should take two Mini ISAs one cash and one shares.
If you are a higher rate taxpayer then you are benefiting from holding shares in the ISA although still at a lower rate than the cash.
If Capital Gains Tax is more of an issue for you than income tax then put the shares into the ISA alone as they have the potential for taxable gains as well as income.
It also depends on what you want to use the cash for. If it is likely to be spent in the short-term then don't put it in the ISA as you will lose the allowance when you withdraw it.
Don't forget that the ISA and CGT rules are changing next tax year. Also whatever you do, don't forget to take the ISA out before the end of the tax year.
Matt Pitcher is a wealth adviser at Towry Law Group and a Moneywise Ask The Professionals columnist
Thu, 14/02/2008 - 16:45
From 6th April this year, the government will allow transfers from a cash ISA to a stocks and shares ISA, but not vice-versa. Whether or not an individual fund manager will accept such a transfer, I believe, is up to them.
Wed, 20/02/2008 - 10:01
It should be very easy, although we will only know from 6th April onwards. In terms of cost it depends what you are buying.
Most unit trust/OEIC funds will carry an upfront charge of 3-5% depending on whether you choose the fund yourself or pay commission to an adviser. Much of that upfront cost goes to the adviser don't forget.
If you buy tracker funds then they often carry little or no upfront charge, as do many Investment Trusts. Equally if you move the ISA to a cheap internet stockbroker and buy shares yourself then the cost may only be admin and dealing costs.
Matt Pitcher is a wealth adviser at Towry Law Group and a Moneywise Ask The Professionals columnist
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If you want to invest £7K in equities and £3K in cash, is it better to fill your ISA with equities and hold the cash outside, or put the cash and £4K of equities in the ISA and invest £3K in equities outside the ISA?