Best of the Week
Most Popular
1. Gold vs Cash in a Financial Crisis - Richard_Mills
2.Current Stock Market Rally Similarities To 1999 - Chris_Vermeulen
3.America See You On The Dark Side Of The Moon - Part2 - James_Quinn
4.Stock Market Trend Forecast Outlook for 2020 - Nadeem_Walayat
5.Who Said Stock Market Traders and Investor are Emotional Right Now? - Chris_Vermeulen
6.Gold Upswing and Lessons from Gold Tops - P_Radomski_CFA
7.Economic Tribulation is Coming, and Here is Why - Michael_Pento
8.What to Expect in Our Next Recession/Depression? - Raymond_Matison
9.The Fed Celebrates While Americans Drown in Financial Despair - John_Mauldin
10.Hi-yo Silver Away! - Richard_Mills
Last 7 days
Silver Springboards Higher – What’s Next? - 26th May 20
Stock Market Key Resistance Breakout Is Where the Rubber Meets the Road - 26th May 20
5 Ways To Amp Up Your CFD Trading Today - 26th May 20
The Anatomy of a Gold Stock Bull Market - 26th May 20
Stock Market Critical Price Level Could Soon Prompt A Big Move - 25th May 20
Will Powell Decouple Gold from the Stock Market? - 25th May 20
How Muslims Celebrated EID in Lockdown Britain 2020 - UK - 25th May 20
Stock Market Topping Behavior - 24th May 20
Fed Action Accelerates Boom-Bust Cycle; Not A Virus Crisis - 23rd May 20
Gold Silver Miners and Stocks (after a quick drop) Ready to Explode - 23rd May 20
3 Ways to Prepare Financially for Retirement - 23rd May 20
4 Essential Car Trade-In Tips To Get The Best Value - 23rd May 20
Budgie Heaven at Bird Land - 23rd May 20
China’s ‘Two Sessions’ herald Rebound of Economy - 22nd May 20
Signs Of Long Term Devaluation US Real Estate - 22nd May 20
Reading the Tea Leaves of Gold’s Upcoming Move - 22nd May 20
Gold, Silver, Mining Stocks Teeter On The Brink Of A Breakout - 21st May 20
Another Bank Bailout Under Cover of a Virus - 21st May 20
Do No Credit Check Loans Online Instant Approval Options Actually Exist? - 21st May 20
An Eye-Opening Perspective: Emerging Markets and Epidemics - 21st May 20
US Housing Market Covid-19 Crisis - 21st May 20
The Coronavirus Just Hit the “Fast-Forward” Button on These Three Industries - 21st May 20
AMD Zen 3 Ryzen 9 4950x Intel Destroying 24 core 48 thread Processor? - 21st May 20
Dow Stock Market Trend Analysis and Forecast - 20th May 20
The Credit Markets Gave Their Nod to the S&P 500 Upswing - 20th May 20
Where to get proper HGH treatment in USA - 20th May 20
Silver Is Ensured A Prosperous 2020 Thanks To The Fed - 20th May 20
It’s Not Only Palladium That You Better Listen To - 20th May 20
DJIA Stock Market Technical Trend Analysis - 19th May 20
US Real Estate Showing Signs Of Covid19 Collateral Damage - 19th May 20
Gold Stocks Fundamental Indicators - 19th May 20
Why This Wave is Usually a Market Downturn's Most Wicked - 19th May 20
Gold Mining Stocks Flip from Losses to 5x Leveraged Gains! - 19th May 20
Silver Price Begins To Accelerate Higher Faster Than Gold - 19th May 20
Gold Will Soar Soon; World Now Faces 'Monetary Armageddon' - 19th May 20
Gold Mining Stocks Fundamentals - 18th May 20
Why the Largest Cyberattack in History Will Happen Within Six Months - 18th May 20
New AMD Ryzen 4900x and 4950x Zen3 4th Gen Processors Clock Speed and Cores Specs - 18th May 20
Learn How to Play the Violin, Kids Activities and Learning During Lockdown - 18th May 20
The Great Economy Reopening Gamble - 17th May 20
Powell Sends a Message With Love for Gold - 17th May 20
An Economic Renaissance Emerges – Stock Market Look Out Below - 17th May 20
Learn more about the UK Casino Self-exclusion - 17th May 20
Will Stocks Lead the Way Lower for Gold Miners? - 15th May 20
Are Small-Cap Stocks (Russell 2k) Headed For A Double Dip? - 15th May 20
Coronavirus Will Wipe Out These Three Industries for Good - 15th May 20
Gold and Silver: As We Go from Deflation to Hyperinflation - 15th May 20

Market Oracle FREE Newsletter

Coronavirus-stocks-bear-market-2020-analysis

Top Up Early and See your Cash and Shares ISAs Grow

Personal_Finance / ISA's May 31, 2007 - 11:08 PM GMT

By: Nationwide

Personal_Finance

ISA holders could earn an additional £594 million by topping up at the start of the tax year

Nationwide Building Society estimates that people in the UK could receive an additional £594 million on their savings and investments by topping up their existing Individual Savings Accounts (ISAs) at the beginning of the new tax year, rather than at the end.


The new tax year starts on the 6 April and adults in the UK are allowed to save or invest up to £7,000 in ISAs. In order to give any savings or investments the best possible opportunity for growth, Nationwide advises people to top up at the start of each tax year or to make regular contributions throughout the year.

Nationwide estimates that:

  • If the 11.8 million people who hold a cash ISA were to pay the full £3,000 into their account at the beginning of the tax year – rather than a traditional savings account - they would receive an additional £354 million in tax-free interest.*
  • If the 4.5 million people who hold an equity ISA were to top up on 6 April – rather than invest in a traditional savings account - they would save £240 million in tax.**

Stuart Bernau, Nationwide's executive director, said: “We recently announced that savers could be paying more than £500 million extra in tax by failing to use their full annual ISA allowance, but this is not the only way people could be missing out. By failing to top up their ISA at the start of the tax year, people are losing out on the chance to see their money grow to its full potential. And for those with high interest paying accounts, such as our Fixed Rate ISA Bond which offers a guaranteed interest rate of 5.85% for one or two years, this can make a big difference to their account balance come the end of the ISA season.

“Understandably, not everyone is in a position which allows them to use their full ISA allowance each year but we would encourage anyone who has some money to put aside – even if it is just a few pounds here and there – to save or invest in an ISA and avoid paying tax on the proceeds.”

For further information:
Roy Beale , 01793 655689
Sue Knight , 01793 655196

Notes

* At March 2006, 11.8 million people held mini cash ISAs (source: Mintel June 2006). If all of these customers paid £3,000 into a cash ISA at the beginning of the tax year, rather than at the end, they would receive an additional £354 million in interest compared to a traditional savings account (assuming a 5% interest rate and a basic rate of tax at 20%).

** There are 2 million maxi equity ISA holders and 2.5 million mini equity ISA holders in the UK (source: Mintel June 2006). If all of these maximised their equity ISA allowances (£7,000 maxi and £4,000 mini) they would contribute £14 billion and £10 billion respectively. If this combined £24 billion were to be placed in a traditional savings account (assuming an interest rate of 5%) it would earn £1.2 billion in interest. Assuming a basic rate of tax at 20%, £240 million would be paid in tax. If this money were to be placed in an equity ISA this tax would not be payable.

Existing ISA holders could earn £594 million more on their accounts by topping up early. If all 33.8 million people aged over 16 who do not currently hold an ISA were to pay £3,000 into a cash ISA - rather than a traditional savings account - at the beginning of the tax year, they would receive an additional £1.014 billion in interest (assuming a 5% interest rate and a basic rate of tax at 20%).

Savers can invest up to £7,000 in Nationwide's ISAs each year:
Option 1: up to £3,000 in cash and up to £4,000 in equity ISA
Option 2: up to £7,000 in equity

Nationwide offers:

Fixed Rate ISA Bond
5.85% gross p.a/AER for balances of £1 and over. One and two year terms available.

Members' ISA Bond
5.40% gross p.a./AER for balances of £1 - £9,999
5.45% gross p.a./AER for balances of £10,000 - £24,999
5.50% gross p.a./AER for balances of £25,000 and over

Instant Access ISA
5.10% gross p.a./AER for balances of £1 - £9,999
5.15% gross p.a./AER for balances of £10,000 - £24,999
5.25% gross p.a./AER for balances of £25,000 and over

Nationwide Equity ISA
Choose from a range of five investment funds to be held in an equity ISA ‘wrapper':
High Income Fund, Target Return Fund, Balanced Fund, Tracker Fund FTSE All Share, UK Growth Fund
No initial charges
Invest from £20


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules