Investing
One in four pays “too much tax” on savings and investments
More than one in four adults in the UK pays too much tax on their savings and investments, according to NFU Mutual.
The lender found that as many as 12.5 million adults save or invest without making use of a tax-efficient ISA even though a greater and more flexible limit of £15,000 comes into force on 1 July.
Just 47 per cent have any savings or investments in ISAs, according to figures from HM Revenue & Customs.
NFU Mutual said that based on 2012 research from ING Direct, around 27 per cent don’t have any savings at all, meaning the rest – 26 per cent – will be paying tax on their nest eggs.
“If you have savings and investments but no ISA, you could be losing out,” says Sean McCann, chartered financial planner at NFU Mutual.
“By not making full use of an ISA allowance, savers and investors could be giving money to the taxman unnecessarily.
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“Putting money in an ISA is one of the simplest things to do to protect your money from the taxman and the rules are set to become even more flexible.”
The limit to how much each adult can save or invest in an ISA will dramatically increase on 1 July from £11,880 to £15,000 per person per tax year.
The new ISAs will allow investors to transfer cash ISAs to stocks and shares, and vice versa.