The end of the 2009/10 tax year is rapidly approaching and now is the perfect time to consider your Individual Savings Account (ISA) options. These tax-efficient wrappers are a popular and simple way to save, as you don’t pay any personal income tax or capital gains tax on any profit you may make.
Q: Can I invest the full £10,200 in cash?
A: No. Although ISA limits have been extended there are still separate limits for cash ISAs and stocks and shares ISAs. The maximum that can be invested in a cash ISA is £5,100, up from the current limit of £3,600. If you are under 50 you will be able to take advantage of this raised limit from next April.
Corporate bonds are a type of fixed interest security. A fixed interest security is a way of ‘lending’ money to a company in return for a fixed rate of interest over a set period. This type of investment is intended to provide you with a regular, reliable income.
The earlier you invest, the longer your money is outside of the reach of the taxman
By investing earlier in the tax year, you could make sure that you are using your Individual Savings Account (ISA) allowance to its full advantage. The earlier you invest, the longer your money is outside the reach of the taxman and has the opportunity to work harder for you.