Individual Savings Accounts: Tax Allowances
The question
To ask the Chancellor of the Exchequer, whether she is taking steps to reduce the Cash ISA allowance.
Answered by Emma Reynolds
ISAs are tax-free savings accounts, which incentivise individuals to save and invest. An ISA investor does not pay tax on interest, income, or gains received in an ISA and there is no need to declare any ISA interest, income, or capital gains on a tax return. This is made clear within the self-assessment process. Detailed information on how ISAs operate, and their tax-free status, can be found on GOV.UK and in the promotional and other material provided by ISA managers to prospective customers.
The Government recognises the important role that cash savings play in helping households build a financial buffer for a rainy day. The Government also wants to see more consumers participate in capital markets and benefit from the long-term financial security and returns that investing can provide.
As with all aspects of the tax system, the Government keeps ISA policy under review.
Verbatim has judged this answer against the question that was actually asked — answered, partly answered, or evaded. Sign in to see the verdict →