Big Changes to UK ISA Accounts?
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Tax on savings is a national disgrace in itself
Not really. Collapsing schools is a national disgrace, taxing part of the interest earnt on hoarded wealth is just annoying to people with lots of money.
@@tomonetruth spoken like a true envy ridden man who thinks he is entitled to someone else's money. Saving for the future should be in everyone's mindset but when there are totalitarians like yourself it discourages just that and in the end you have a society that believes someone else needs to provide for hem. Well done! schools have nothing to do with it.
@@tomonetruth or people who are trying to get out of the shitty housing estates they've been deliberately funnelled into...
@@tomonetruth Well said. There is a lot of greed about. 😞
Ideally no tax on ANY savings, money going into savings has been taxed numerous times previously.
Its the interest that's taxed not the original sum ... so this has never been taxed before
@@jeanlawley6483 The original sum was built from taxed income, the interest on that taxed sum is then taxed again if over allowances.
I’m sure your countries oligarchs will enjoy this policy.
@jeanlawley6483 not really, only the interest above inflation is new money. Most / all ofvyhevinterest is just to stop the value being eroded by inflation.
@@jeanlawley6483 The original sum is also taxed by means of increase in the money supply -- at a yearly rate of 7%, mind you. The government pinches 7 per cent of your savings every single year without you having to do anything with that money. Cash savings are a terrible idea.
It’s crazy that we pay tax on anything over 20k saved when it’s already been taxed at source! We shouldn’t be taxed more than once
We are also entitled to 1k savings interest tax free if Basic tax payers. But do not have compound interest over more than 1 year esp the initial amount is big. I had my over 5 years compound interests and received over 2.5k in the end when the interests rate was very, very, low.
HMRC allowed me 1k tax free and the rest was taxed at 20%. I got caught! but didn't know the implications as the Government was not clear on this initially when the 1k interest tax free was introduced.
It still hurts!
Just receive the interest every year, don't over 1k per year. Then you get the tax free 1k.
Not sure if this apply to Scotland?
Pound coins don't remember they've already been taxed! We pay tax on transactions, not "at source", whatever that means. There is no tax on savings - it is the interest "earnt" on savings that is taxed, and there are plenty of ways of not having to pay that, such as ISAs, allowances, donations, and just spending the stuff.
Same for state pensions. This government wants no private ownership of anything.
@@Fafe953pathetic comment
You aren't taxed on any money you put in. It's only the interest on those savings that is taxed, and even then only after a certain amount based on your tax band. Best to understand the system before you comment on it.
Stamp duty on buying uk shares should be abolished, the uk government give no incentive to invest in its own markets, instead see tax tax tax. I recently opened a junior stocks and shares isa for both of my children, aged 7 and 9. Even they had to pay stamp duty 🤦🏼♂️. What a disgrace 🫤
Thanks David where did you get your economics degree from?
@@thebenevolentsun6575😂😂
But you bought them regardless. Stamp duty didn't deter you. So by your own logic it wouldn't be an incentive.
@@thebenevolentsun6575What was said that you think should require a degree ?
Everything said seemed reasonable enough to me.
But anyway, I am glad we are in your well educated company.
@@thebenevolentsun6575 it might surprise you, but you don’t need an economics degree to work out, 0.5 % on large trades leaves you slightly lighter in the pocket, or your portfolio. As the uk economy is rather stagnant and in the shit, it seems incentivising people to buy in the ftse/ uk stock market might good in the long run. Perhaps you like paying even more taxes?? Who knows 🤦🏼♂️
I am 60 years old and have been doing the right thing for years. Living within my means, and investing the rest into shares ISA ‘s and letting compounding do the rest.
I have been doing it since we had PEP,s, which some of your older viewers may recall.
I have built up a sizeable amount of which I aim to help me retire early.
My worst nightmare is if they tax Isa,s in some way or put a cap on what you have in isa,s already and put a wealth tax grab on the rest.
After the labour government taxed dividends on private pensions years ago ( and at the same time gave public sector workers way above inflation pay rises- ring a bell?) thereby helping end final salary schemes ( mine went into the pension protection fund) I worry all my plans will come tumbling down again.
What is it about this country where politicians feel the need to take money off hard working people who have done the right thing to try and grow their wealth and security and spread it out to the lazy and feckless.
I am dreading what the chancellor will come out with tomorrow..
When they spot a section of society doing "too well", they drag them back down. It's a standard cycle.
It's the politics of envy.
But they want you beholden to them and not independent.. They hate that cos they lose control.... Its all about control.
I agree. The hard working try to invest to secure their future and to not rely of state hand outs including pensions , yet governments want a piece of our hard earned money.
People with no assets yet more benefits than tax payers
@@ploppy193 Also known as socialism.
The reason why most are cash ISA's is because most people do not have enough cash to risk in shares because they have no knowledge or experience in knowing who to invest in.
Yeah the general public knows nothing about index funds
@@Makalon102 I think that people are turned off on Index ISAs because they see the occasional dips and think 'what if I need my money when that happens'. On the other hand, they are perfectly happy to lock their money into 3 or 5 year cash ISAs with a lower payout, but predictably so.
Ermmm... The first thing is that Not only standard ISA paying crappy rates but the restrictions and the fact you have to rely on the provider to transfer out to something else and fees to do so, make them a pointless product for many... Is it a flexible ISA, is it this, does it allow this, how can do that... Complication that nobody wants...
Yeah most isas from high street banks offer crap funds
I am one ...to risky to invest i believe!!
Asking Labour to review ISAs is like letting a bear inspect your honey supplies.
I think that’s very offensive to the intelligence of bears.
Labour and Conservative are both the same with different liveries: red and blue - but, they do nothing for you.
It was the last Tory chancellor that reduced the Capital Tax threshold to £3,000 from £12,000 and brought many thousands of working people investors into CGT for the 1st time, even investing to keep up with inflation is now taxed.
@@ernestthesmallholder559 I know, that's why I voted Reform for an actual change, unfortunately our voting system is designed to keep the status quo, they got far more votes than the Lib Dems, yet they get 70 odd MPs and Reform only got 5, and they call that democracy?
@@sonofsomerset1695 I did too and I agree with you, that is not democracy, it's an illusion.
@@sonofsomerset1695 Reform ltd company, a Farge's registered company.
We earn our money and pay tax, so why should the government tell us or control our savings, make savings interest tax free, we have paid tax already, leave it up to the banks etc decide how much interest we earn.
Has the civil service and public sector in general achieved any goals?
So you're advocating for abolishing capital gains tax across the board?
@@GamezGuru1 Tax the banks' fat profits
You’ll be even more pissed to know that tax is the least of our problems. They debase the currency annually, so while we work hard for our money they can print it which increases the money supply and raises asset prices relative to our wages
cause its a scam same as taxes. You and me will pay in 10x minimum to whatever those scum give us in the form of pension.
The govt. should not have the right to tell us where to invest our money. It's up to them to make the UK a good place to invest in!
No, but we do need them to make investing tax free for us as much as possible. They really need to raise the ISA limit....
Communists have no off switch. They want to control your soul, your children. The government are your mum and dad.
@@IAmebAdger why do they need to raise the limit when only the top 7% use it to the limit? They need to get more people to use them first.
Disagree. If the tax payer is going to subsidise the minority who can afford to set aside money in an ISA (i.e. you and me), they have the right to tell us where they want their money (our subsidy) spent. Tax subsidies are not a god given right, the alternative is just to take it away.
@@paulbo9033Not taxing something is NOT a subsidy.
I wouldn't trust this government with anyone's money.
HL fees are a barrier to purchasing shares. They can fix that without government intervention!
HL for the fund and share account is good and the 11 fee is works out cheaper than other platforms. No platform fee , just that 11 and If you have 5 figures on it , it’s good deal
@davidbarclay54
Agree with you. Hl charges 0.45% for holding open ended funds, oeics etc. Which is very expensive. And they charge £11.95 for each dealing charge. Their isa is cheaper if you only invest in etfs, individual stocks and investment trusts, it's capped at just £45 per annum at the moment. But still £11.95 dealing charge. And same with the sipp capped @£199 per annum. It's cheaper for larger amounts. Fidelity UK charges 0.35% for funds in isa and sipp. But if again you only use etfs, stocks and investment trusts it's capped at £90 per annum for isa & sipp, plus dealing charges are just £7.50 per deal. Vanguard UK charge just 0.15% per annum for investing in etfs or open ended funds, and no dealing charge of you buy or sell etfs like the funds, if you want to buy, sell etfs in real time the dealing charge is £7.50. If you want to hold your stocks, etfs or investment trusts in HL's fund and share account then no platforn fee but still dealing charges. And why would you want to hold your investments in a taxable account?
@@coderider3022 The dealing charge on HL is £11.95 per deal and why would you want to put your money into a taxable account. Other platforms have Lower platform charges and lower dealing costs
@@coderider3022 Yes, perhaps clarify that you pay a big fat ZERO fees ... provided you scrupulously stick to ETFs (or shares). The £12 fee is tolerable, but not as good as something like T212 (er, £0). Someone also told me that HL's FX rates are a rip-off, so proabbly also avoid ETFs denominated in USD, and stick with GBP.
HL, J.J.Bell, and other investment companies, do the investing legwork that it would be impossible, time consuming, or limiting of choice, to do yourself. They arrange the investing of your money into the actual shares, funds, whatever, according to your choices. Also, for " managed funds" they do all the managing. Someone who knows the finance system enough, has to do this sort of thing unless you want limited to automated systems. I think there are regulations, funding, and legal requirements about things like how they advise clients. All this requires trained/ qualified people. They have a wide range of investment options. Regarding HL, I experienced helpful staff on the phone to guide you through getting
started with setting up an ISA and setting up payments to your specified investment choices. They also have a website with hundreds of options listed. It includes a system so you can see how your investments are doing and make changes as required. The site had to set up and needs maintained All this costs money. Considering all they do for us, including much more support than online trading apps, they earn their fee, which is a tiny cut in what you are paying in. You get what you pay for.😅
If you want to boost investment in UK equities, get rid of capital gains tax on UK shares.
you don't pay that on earnings within an ISA wrapper. that's the whole reason it exists in the first place.
Cap gains tax will stay and if anything it will go up a couple of % unfortunately.
@@Drive-n-Vibe And that is just £20000 sharing with the limits of other ISAs. Hardly attracting any subtantial investments.
@@clifford4393 it's substantial if everybody actually took advantage of it but they dont...
Under pressure from who?
Great discussion, Toby. I personally can't see them increasing the ISA allowance. That wouldn't do anything significant really to help the UK stock market and can be twisted by the media as helping the super well-off invest more tax free (no chance Labour doing that).
I'd love stamp duty to be abolished and i think that would make investing in UK stocks much more appealing.
And I don't think it really matters where the UK companies make their money. In a world of globalisation, you'd expect large companies to make most of their money abroad. What matters is getting the next global giants to be listed and headquartered in the UK! I can't see that happening either, as the UK just can't really afford the tax incentives at the moment.
Laffer Curve suggests that tax incentives can increase tax revenue.
Considering the government recently changed the capital gains tax from 12,000 tax free to just 3,000 then that's the first thing to reverse.
I was flabbergasted that they continually reduced it by 50% per year until it was a little over £3k
@dominikpierre-louis5028 it was about £1000 free in 1980, which is about £7,500 today adjusted for inflation. We're literally less than half the allowance from the 1980s. The government said the £12000 was "very generous," which it was, but taking it down to £3000 is just making the little guy with small side gigs get screwed. The people reasonably small businesses are only inconvenienced and the medium to big business won't notice. Why can't they tax the rich property? Fuckers
The ISA limit should be increased each year at least in line with inflation. As it is, it’s another fiscal drag reduction in people’s wealth.
Good luck with that idea with this government!
Anyone who can save more than £20,000 every year are the last people to be complaining.
My original £5K to £10K has made me very well off!
I use FTSE Developed World ex-U.K. Equity Index Fund - Accumulation. That’s how much faith I have in the U.K.! lol
Cheers Toby 😊
...and it's returns have been excellent!
same i have this but also ftse 100 but its more like weighted 4% to 15% lol
lol, I’ve made so much on Rolls Royce :)
Same here!
Same here, it's been a great investment so far.
Totally agree that stamp duty on share is a barrier. The fact that the UK market moves like a slug doesn’t help either.
No one is investing in the UK markets anymore... It's been some time now. Really low growth besides a few companies, US all the way
0.5% is nothing in the scheme of things when brokers can charge up to £20 basically for a mouse click
@@rizswitheral6304 hilarious, my uk fund is up 22% in 12m.
@@rizswitheral6304 thats a rather blanket statement, and completely untrue. If no one was investing the UK stock market wouldnt exist.
Stamp duty, on property? Abolish stamp duty and folk use that money to bid more on housing XD
I like this guy... sensible, logical and practical. Keep up the good work :)
I had no idea about stamp until my transaction went through and i saw it presented on screen
You wait until the Swiss or yanks keep a chunk of your dividends!
If they increased the ISA allowance to 40k or higher I’d happily put the increased allowance component into a UK ISA type fund. Personally, I think the ISA limit should be removed entirely. No savings should be taxed.
So the super wealthy pay absolutely nothing? Reduce tax on work first, not give those with wealth unlimited tax breaks.
I bet you and everyone who has liked this comment also believes that the NHS should be free to all, we should have free schools and benefits for the poor. Someone has to pay.
@@thomasowen2585we have already paid tax on what we save when we earn it. Savers are double taxed.
If you work you pay, if you buy you pay, no matter what you do you pay. We are one of the most taxed societies in the world.@@thomasowen2585
Yeah, via income tax, which we already pay. Also the NHS and schools are already free, so what you smoking?
I don't see them touching the current ISA arrangements. The tax free lump sum from pensions on the other hand is low hanging fruit they will not be able to resist.
My resignation form is on my phone, ready to go...
Massive rucktions ahead as public sector pensions pay an equivalent lump sum
Take it away from private sector pensions then it must go from them too
@@jasonaris5316 True, but they could smooth that process by say offering above inflation rises to the public sector.
@@geofflancaster8542 ha. They were my thoughts also. Or perhaps reduce my hours.
@@MrScootmcg You're basing that on... Nothing.
For adults in the UK, the median amount held in cash savings is just over £1000. People aren't put off investing because there are "too many types of ISA" - it's because they don't have enough money. If the government wants more investment into UK listed companies, it needs to look at UK pensions - that's where the money is. For various reasons, we are the only country in the world who's pension funds underweight their own domestic market. That's harder to fix, but it will have a meaningful impact. The UK ISA is a nice-to-have for people who already have far more money than most - it's a (failed) vote-bribe, not a solution to anything.
Many people don't save because they break benefit capital sums. It would be silly to save and then lose thousands in benefits. You could have tens of thousands in cash at home or Gold or other assets, but £16k in the bank. Hell no.
I think people just don’t understand ISA’s. So many people I know just leave their money in savings accounts.
@SomeLad12 there's very little to understand
@@juliantheapostate8295 probably more the case that they don’t see the point or aren’t aware of there exist rather than they don’t understand them.
You need the younger generation to subsidise those pensions and the younger generation are already toast.
People don't save in ISAs because our disposable income has been eroded in the last 5 years. Low and middle income earners do not have £20,000 a year to invest. The allowance is purely for the wealthy. Do I have a stocks and shares ISA, yes? Do I have £20,000 no and I never will.
Speaking as a 'normal' person with little understanding of the finance world, I find the comments informative. Within a few posts each thread soon becomes a debate that uses complex jargon and acronyms. That stuff both terrifies and confuses me so I choose to go the easy route with a cash ISA and a boring old bank savings account. Yes, I'm probably missing out financially but as the presenter points out, the world of personal finance is too challenging for many of us.
No chance of those things changing. In fact I wouldn't be surprised to see them coming after the ISA and at least cut the annual allowance, or possibly scrap it completely.
I Hit 110k today. Thank you for all the knowledge and nuggets you had thrown my way over the last months. Started last month 2024. Financial education is indeed required for more than 70% of the society in the country as very few are literate on the subject. thanks to Katherine Storch for helping me achieve this.
Financial services want things to be complicated. I shut down my HL stocks & shares Isa because of all the fees & charges - while I was taking the risk. Now I just have cash Isa's at 4.98% monthly.
You need to shop around, HL is a big name company that gets by on name recognition and thus doesn’t need to be competitive
Use something by like trading 212 or InvestEngine with 0 fees
I agree with raising the isa cap rather than creating the brit isa. But I like the cash isa to be separate from my s&s isa.
Why ?
If they were combined it would just making switching between cash and shares easier. Also, it would probably force providers to give better interest rates for those that have cash in their stocks ISA.
@timg1246 not all stocks and shares providers are proper banks and therfore not covered by financial compensation scheme. I've got trading 212 for s&s but if I opt to collect interest on un-invested cash, they put it in the money markets and it isn't protected. Let banks be banks for cash isa and trading platforms deal with s&s isa.
@@jamesclark6257Stockbroking sites ARE covered by FCA protection. Including Trading 212. From their website :
"We do not use any of our client's funds for our own hedging or margin trading".
The full spiel also says that client cash is separated into its own bank account, as is normal, from company money.
Clients carry risk when they buy shares, but cash is protected up to £85,000 per client, per FCA licence. That includes any cash in any account. Most people would always make sure that no one institution carries more than £85,000 of their cash.
So, if Trading 212 went bust, you would eventually get back your cash after an administrative delay.
@@jamesclark6257trading 212’s Cash ISA is protected by the FCA guarantee as they can’t use the money markets for a cash ISA. You can move money between them without it affecting your ISA allowance.
@jamesclark6257 investments are covered by the FSCS although I appreciate you were talking about volatility risk
Hi Toby, when you posted the 'election ISA discussion' it felt very hypothetical and informed by rumour and guess work, and I was critical. I apologise. Looking back you were 100% right to highlight the discussions that were arising about what the ISA is, what it could become and what it is achieving. So a belated Thank you for being ahead of the game and raising awareness.
This follow up video is flagging some critical questions and as you rightly, yes still feel guilty about being critical of the last one, highlight with AJB and HL uniting to flag questions and issues there is clearly motivation from Industry to simplify. I must also add that I've just sold out of UK stocks because of the poor returns so here are some personal observations, thoughts to add to the discussion:
1. UK Performance vs Rest of the World - UK FTSE performance in a highly accessible world does offer great dividends but the next 10 years will be about disruptive growth... so why hamstring yourself with stocks that are being excessively burdened with tax, no I don't think stamp duty is a deciding factor but it doesn't help.
2. UK individuals wealth - The £20k cap is in my view unlikely to change, unless it would benefit the govt. priorities since most people do not have £1k in savings. So I suspect the Labour Govt. will be looking to help encourage people to save a little. That said if ISA money could be used, like the rumoured UK pensions, for UK infrastructure... then I think they would consider a mechanism.
3. Simplicity - It took me a good while to get my head around: ISA choices, ISA providers, ISA charges (trading, exchange fees etc), ISA vs Pension etc. capital gains, dividend interest allowance... the list goes on. From my perspective one single ISA that serves as a wrapper to allow you to hold: Bonds, Shares, Cash, Gold, Crypto, Commodities is the only real way to do this... remove the noise.
So what would I like to see, well I'll list below the changes but at the heart of this respecting the priorities of the Labour government and their motivation is key to making any change happen:
1. Remove the distractions of Lifetime ISA, Cash ISA, Stocks and Shares ISA by renaming the ISA as The UK ISA that allows you to hold any financial asset.
2. Link the annual allowance of £20k to inflation and increase it in the budget. Rounded to nearest £1k so keeps maths simple.
3. Ensure any cash held in the ISA receives the good interest return some providers offer: 5.2% with T212 currently.
4. With distractions removed it'll make it easier for providers to market one single solution... but allow people to have different providers so you could split it into 4 pots of £5k.
5. The real incentive to encourage people to save should not be the first house... but should be the importance of saving and investing. To do this I'd offer two initiatives as the Labour government.
Initiative 1 - Any new ISA opened in each of the next 4 years of the Labour government are rewarded with a Govt. contribution of 25%. Up to a maximum of £1000 contribution (copying the House Buyer model but widening it). Conditional on it being held in the account for minimum of 2 years. So the lock in gets people used to the habit.
Initiative 2 - Any uninvested cash in the ISA is used by the UK Govt. instead of the money market that generates the cash interest... to underpin UK Infrastructure investments (similar to a bond but without the time lock) with interest paid daily.
We could get rid of the capital gains tax allowance of £3k, and the dividend interest £1k allowance and just clean it up. That effectively taxes the rich a little more... people able to use the £20k allowance would be hit... so politically not going to hurt labour, it would redirect this small tax receipt into front funding the encouragement of more people using ISAs and reduce admin costs of ISA providers whilst expanding their client base.
Sorry longer message than planned... but what I love is you have us talking about this... and I'm not heading for brunch with friends... to drink coffee and this will be the discussion. They don't have ISAs... argh.
I do hope Labour do something to get more people using them. Any simplification is better than nothing.
I agree with your opinions in regards to the extra 5k.. I think a big government education campaign in the UK ISA pros and cons would be very good.. so many people are totally ignorant in where the best place to put your spare cash... Cheers
No government will ever push financial education out to the general public. They want worker drones and only the already wealthy get this education. It is for us, the generally 'poor', to educate ourselves, our children, and those around us.
I honestly think financial literacy should be taught in schools. We're sorely lacking it in this country.
@@billB101 Do you know any country that has more financially literate people?
@@londonspade5896 what relevance does that have to my point?
The government don't want a financially literate populace as they would realise how much they are being fleeced
What is the UK good for investing in? Capital growth? Income? It depends…seeing ARM not want to list here makes me think UK isn’t investable for now or a few years.
Bubbly tech stocks do well in the US. If you want something more traditional and long term there are options out there.
We need to encourage manufacturing in the UK. We cant keep sending our money to China. Its working in the USA.
The problem with the UK is that anything that starts to do well is imediatelly pounced on by the government and slowed down so badly everyone else simply over takes it leaving it with no gain and probably a loss in market share. Nobody with a functioning brain would start a company here that they could anywhere else. Literally one of the worst countries to invest in.
Regarding investing in British Businesses - you could look at improving SEIS / EIS schemes and certainly increasing the awareness. I feel SEIS and EIS aren't discussed enough.
Or VCTs
From $37K to $45K that's the minimum range of profit return every week I thinks it's not a bad one for me, now I have enough to pay bills and take care of my family.
Please where and how did you earn that much.
Please how do I go about it
I'm still a newbie on investment trading and how can I make profits.
I would really love to know how much work you did put in to get to this stage.
All thanks to LEO CLIFFORD
**Leo Clifford is a licensed broker and a FINRA AGENT here in the States.*
One ISA. £25k limit. Able to buy stocks and shares globally, but also cash not invested gets the standard interest rate. Keep the LISA.
I am part of the 7% that maxes the ISA out and I’d rather invest outside the UK in a GIA and risk paying taxes than invest in UK business.
Personally, my ISA is my pension. Tax free gains and can take out whenever I want? I would rather do that than wait until 70 odd and still pay taxes.
My best returns in the last 9 months are from the UK market, always a bad idea to invest based on the past.
@@edc1569Good luck
@@edc1569Eh… where you looking? VUSA has done 19.8% past year, FTSE100 11.4%. FTSE 250 at 18.68%
We have nothing to indicate future performance, but the past although not an accurate indicator, it’s the best we’ve got
I think if you combine the cash ISA with stocks ISA then all you are doing is guarantee that in 10 years tome there will be another financial scandal with customers getting compensation saying that they were misled into loosing money when they thought their money was safe
ISAs certainly have an important place due to their flexibility (the ability to withdraw whenever you need it). However, you do understand that the same amount invested the same way in a pension (SIPP) will always deliver 6.25% more than an ISA, even after tax? If you pay 40% income tax, or you can save into your pension by salary sacrifice, then you can gain an even greater benefit.
If they means test state pensions what incentive will there be to save?
The incentive will be anyone who wants more than 10k/year retirement income in today's money
Exactly - they don't want anyone to own anything, they want people to depend on the government for every aspect of their life, material and moral.
Raise the allowance to 25k and 5k ring-fence as British isa with no transaction fee & stamp duty on transactions under it. This will nudge more retail investors to investing & helping British listed shares.
The problem isn't investment limits. The problem is the appalling return on investment. Fees (whether agency fees, stamp duty, annual membership or whatever else) just compound the problem.
Until the rate of return at least keeps up with inflation, you're better off building a "rainy day fund" to cover emergencies and then just spending the rest having a good time. Better that than watching the real value of your savings get inflated away with the likelihood that whatever is left when you retire will be means tested as a way to reduce your state pension.
Thats legacy finance for you, banks and 3rd parties . Peer to peer is the way to go - de centralised finance
Thank’s for the insight Toby.
A 0.5% purchase penalty is huge and a significant deterant to retail investors buying the shares. That's a good chunk of annual return. What are we getting for that money that investors in other countries don't get for free?
Behave.
So obvious as well. I made the mistake of trading Barclays on the LSE once , never again I realized the round trip fees,.you can trade anything for tiny trade commissions in the US. Even trade the UK ADR for no fee
Er £100 and the stamp duty is 50p. Huge? I think your scale may be somewhat skewed.
It’s only when you make a purchase unless I’m wrong.
@@davideyres955 It's an added 0.5% cost on any purchase amount, which is a lot when the alternative is free (which is the case in other countries) and there is zero benefit to you from paying that
Daily volatility is regularly more than 0.5%. If you hit a regular pullback, that could mean a devaluation of 5-10% but valuations usually recover quite quickly. By that measure 0.5% stamp duty is almost irrelevant.
A new Government should be bold and raise the limit to 30k per year. People who make money spend money, so let the 7% make the most of investment opportunities and spend it which supports other businesses.
Speak for yourself mate, I’m putting away as much as I can in ISAs and investments, spending as little as possible.
Europe just doesn’t really do this low tax thinking
It doesn’t work, the tories tried to do this. In a global market, the money simply leaves the country. It might work in the USA but not the uk.
Selfishly, I would like to see the limit raised as I’d max it out too but let’s not pretend any profits made will be spent in the real economy.
I think trickle down economics deserves another try. After all people that make the most money spend the most or something idk.
U make some good points about the British ISA. Most people generally don't understand enough about investing to make an informed decision. but i do think we should incentivise investing in local companies.
All I know is Labour will find at least one way to screw me over financially.
However, Labour aren’t going to make it more than 2 years before the global geopolitical and financial worlds blow them away..🤔
@@DrRock2009if the tories could manage 14 years with 8 years of post Brexit anarchy, I think they’ll be ok.
@@edc1569 Brexit can happen in 2 years’ time, as it will be 10 years on from 2016….🤔
Tories have screwed me royally with high tax bands and reduced tax free allowances
Meanwhile conservatives let Lizz Truss be their leader. I'd say this comment aged poorly but it's a day old... That's a short memory.
I don't like labour, but to suggest they'll be significantly worse is kind of silly given recent history. That's a big reason of why they lost the election
Theres one very simple way to increase business's growth new & old basically scrap business rates or completely rework them to work off income of the business rather than "the building they're renting at 50% of market value"
Stamp duty makes no difference, the poor performance of the British companies is what makes the difference
Every dog has his day, and I much prefer to buy assets on the cheap thanks very much.
"Makes no difference"
Really? The margins on trades can be so small, especially for short-term and day traders. Insane to think you're charged 0.5% every single time.
Totally agree
@@abuibu day trading is dumb anyway. We are talking about investing here not gambling.
Makes A big difference to big funds. Massively reduce the inflow of capital to the UK and British firms. Should have abolished long time ago, to compete properly against other countries and exchanges
The single biggest problem is the lack of education on investing. If people understood more about investing then people would invest more, which in turn will put more money into the UK stock market and benefit the economy.
I suggest that we will see a special 2030 Carbon Free ISA, possibly with tax relief at source, where investors will be invited into plugging a massive gap between available government cash and the amount they that want to invest in windmills. If this were the case I would not touch it with a bargepole.
If it included nuclear power I'd be interested. But that's not likely.
It won't include nuclear power cus we still don't know what to do about nuclear waste. Ergo, not renewable.
@Stettafire it could be launched into space. There is no genuine objection to nuclear power
It will be.
@2:40 Stamp Duty is some antiquated 19th Century tax. Should be scrapped on, e.g. houses too...
what other tax or taxes do you think should be increased in it's place to compensate for the loss of revenue to the exchequer?
They should replace stamp duty with a window tax. That worked well 😂
@@Pegaroo_tax on tattoos. That would raise a ton.
@@Pegaroo_ We don't need another tax...get the 9 million "economically inactive" head workers back to work..problem solved.
@@kw8757 You know more than 6 million of these people are on NHS waiting lists. It's crazy that the NHS has went from "World beating" to not fit for purpose since 2010
Yeah the stamp duty thing is bs.
It’s a pretty simple fix, teach tax, s&s, loan, interest etc in school as standard.
Personally, I invest in index funds which exclude the UK for starters. I had some individual shares of UK small companies but i started selling these as the dividends allowance started to be reduced. If they want people investing in UK companies, they should raise that allowance, or lowering taxes in dividends/capital gains outside ISAs, because investing through an ISA is really a very good way of investing, but the choices for providers are very limited when it comes to invest in individual companies rather than in funds. For me at least, all these reforms have done the contrary of what they pretended, because instead of investing more in the UK, i got rid of all the UK shares
Cheaper for the rest of us :)
If you don’t return 12% + a year then you aren’t beating inflation & debasement (money printing). Tech stocks and crypto are the only way to beat money supply growth due to rapid adoption and scarcity
Stamp Duty doesn’t stop me buying UK stocks but it does mean I’m more choosey on my investments and for quicker gains I’m always going to be looking at the US market.
Exactly
Capital Gains, Corporation Tax, Dividends Tax, Isa Allowance, Pension Allowance....This labour government is coming for it all. They will give it away to those on full time benefits
And above inflation wage increases for their friends in the public sector.
I remember back to PEP’S, it was easy. I agree let’s simplify it and have at least 50% in the UK to grow our own companies that are world class but lag behind other companies making them cheap to buy and increasing foreign ownership of these great companies.
1. If the FTSE100 makes 80% of its earnings from its international presence, why is the return on a FTSE100 index so poor?
2. I agree with the idea of scrapping the stamp duty - what do we pay stamp duty for? The ISA money is already taxed, unlike the SIPP contributions.
3. Yes, simplify the ISAs- get rid of the LISA for starters(gets rid of the govt bonus and save the taxpayer some money). And lock in an increase of £1000/y on ISAs
1. The quality of company in the FTSE 100 is nowhere near their US counterparts in terms of ROE. Nobody wants to buy these value destructive companies except some dividend investors and institutional investors.
The LISA has always looked odd to me. Half way between a pension and an ISA with an eye on propping up property prices.
The only way of helping buyers is building more homes and let the law of supply and demand operate. But the middle classes love their property prices, so.....
Its Because Most of the FTSE 100 Companies are dividend Companies so people just live off the income. Its like a load of Vampires sucking the growth from the index. Also technology is extremely underrepresented which doesn't help.
The FTSE 100 has gone from 1,000 to 8,000 in 40 odd years. Is that poor?
@@juliantheapostate8295 The FTSE 100 has gained just over 20% total return w/o including dividends since 10/12/1999. The vast majority of us would suggest those are awful returns.
I have funds albeit small, compared to many. I sit on it as I have little knowledge on stocks and shares isa, and when talking to companies in the field, I get bogged down it non layman terminology that bewilders me an puts me off investing. With a degree of mistrust in those giving advice. I am sure I am not alone, and would be some of the reasons why so many do not invest, lack of knowledge and trust, especially in an online world with a scam around every corner, cheers P
Double the ISA allowance.
Please
Yes please !!!
Quadruple it
Why? So the rich get richer?
@@davem.4003 maybe you 'poor' people should just be smarter with your money and take advantage of what's already there? But no, easier to be ignorant, and blame the people who ARE looking after their finances...
"The British ISA ..." if it comes about should include stamp duty exemption for British domiciled stocks.
I'm not really bothered, that much of the income for the FTSE comes from abroad, that's a good thing, I'd have thought.
A problem for the UK is that many successful UK startup companies, they often get bought up by foreign (US) companies.
British isa went quiet very quickly
Pointless Tory policy is hardly going to be a priority for in incoming Labour government that has to try and right out listing ship.
@@johnmunro4952 Well, except that Labour supported the idea by saying: “Labour has no plans to drop the British ISA,” a spokesperson told City A.M. “Labour wants to make it as easy as possible for people to feel the benefits of saving and investing their money, including through increased utilisation of stocks and shares ISAs.”
Get 5 years labour in power then you will see what a listing ship is.@@johnmunro4952
It was kind of shit, as it only really makes sense when you are already maxing pension and ISA.. Even then..
@@jakerowsell8752 Well, you could then say that it was not restrictive to those who don't have enough money to max the ISA out and was therefore only applying the constraint of having to invest in UK equities to the most well off, who could.
EDIT: Not suggesting that this was intentional by the way.
I think what is more likely is that a lifetime cap will be placed on an ISA account, thus limiting the tax advantage.
Personally I like the Life Time ISA and would be upset to see that go.
Too ageist
Upping the limit to 25k would be a good idea, then raising this a little each year encouraging people to keep saving … allowing folk to have more than one product is great too (I didn’t know that was a thing)
Yes. But it would be interesting to know how many current ISA subscribers are anywhere close to the £20k limit. I've been in a good job most of my career and I've never had enough free savings to get anywhere close to being able to save £20k in a year.
If people are capable of saving above 20k a year they're not the people that need to be encouraged to save since they're already very well off
Why UK love taxing everything even investing into saving? Totally ridiculous to tax already tax paid earnings. They keep taxing already taxed income
Compared to other EU countries , we actually do pretty well on tax , even after labour do some unpicking. Go look at income tax bands.
@@knowledgeseeker5499 We have low taxes compared to comparable economies.
@@Red1Green2Blue3 don’t forget we low salaries and wages for decades compared to other countries. We have almost 70% taxes directly or indirectly
@@knowledgeseeker5499 Why don't you just stop talking about things you don't understand. Salaries are irrelevant because when we're talking about tax burdens we're talking about percentages. Our taxes are low compared to comparable economies.
@@Red1Green2Blue3 it’s very easy understand you want taxes to be increased and don’t want to look into income or higher salaries of those countries.
I don't buy uk shares because of the stamp duty you are down 0.5% straight away I stick to us shares.
I'm the same, UK is a slug.
And how much is daily/weekly volatility? Plus, you are now subject to currency fluctuations as well and how much are you charged for currency exchange?
After I have paid tax on my income, I don’t want to pay any tax on any savings to anyone. It’s MY money which I already paid tax on. I don’t think we should have a limit to how much we can save in the first place. The gov should focus on building a silicone valley and investing in the Uk. Create more jobs, create more buisness opportunities, put a limit on mortgage hikes, make housing more accessible and focus on the living cost aspect of things.
A carry forward rule for ISAs similar to SIPPs might be interesting too
Thats would be amazing. They probably will never implement it unfortunately.
Stamp Duty will make a huge difference. Paying another 0.5% on top of fees and spread is bonkers. Especially on stocks that only tend to grow 5% a year (FTSE 100)
It doesn't help that great UK companies like ARM opt for the US stock exchange instead. Not blaming them, it's just the way the investing landscape has changed in the last 20 years..
ARM didn't opt for anything. Their owner, Softbank, chose the venue that would maximise their return. Prior to the Softbank takeover ARM was listed in London, but predominantly owned by US investors as moronic UK institutions couldn't, and in many cases still can't, see past a dividend.
The petro-dollar is gone anyway. It'll be China now.
I have looked at ISAs a few times but just got confused by them so didn't bother and maxed out the Premium Bonds instead.
UK shares aren't a good idea all the time Starmer is destroying the country. Labour historically love taxing companies to the point that they just leave the country.
There’s nothing complicated about a cash ISA. You can get a one year fixed rate at at least 4.5%. No tax on interest. You can do it at your bank or online.
The government should focus on not backing companies that take advantage of the British system and economy and then move their money out of the country.
Imagine a tree in a community garden. It uses the garden’s resources to grow, but its fruits are sent away, leaving the community without any benefits. This is like a company in the UK making money there but moving its profits abroad, not benefiting the local economy.
This needs resolving for any meaningful change. I understand this is not desirable for those businesses. So let’s get manufacturing again and not just be a service island.
I don't like the idea of combining both cash and stock and share. Choice on who you put your cash isa with is often driven by interest rates..
Scrapping stamp duty on buying shares should be done asap, as in asap! It's actually a disincentive from a retail investors perspective. Simplifying the ISAs would also be good.
I think there should be one type of ISA, hold what you want. Could rename it the inheritable pension account. Have to name a person you want to leave it to. Tax free but 2% admin fee when you die to distribute the ISA to however many people you left it to. Could be open to anyone on Earth. This would bring money back into London and UK again.
25 the way to go
Pension allowances down to £20k... ISA up to £40k. How much would that save, IFS?
The Poms have a pretty good deal with ISA accounts even at 20k, given the average income is 35k. I read this is not a retirement plan. You also separate retirement plans , state pension, workplace pension, private pension and national insurance which fund the state pension. You can't really complain, it's a pretty good wicket and incentive to save for your old age. I assume the ISA is an accumulation account limited to 20k tax free a year.
You assume correctly. You can use ISAs for retirement though, especially as you can open them at any age whereas the private pension access age is 55
I thought there was speculation that Labour might cap the total ISA amount to £100,000 and significantly reduce the yearly allowance.
My isa will be 100k by apr 2026 so I hope not.
I thought 100k is already a limit, and anything above that is taxable
@flesz_ No. I have a £250,000 Stocks and Shares ISA. Entirely tax free.
@@coderider3022 I wish my ISA had the same amount as your by 2026 but it has just over a couple of pounds and that no joke.
It has no limit. I know people who have over £500k each ( as a couple) in ISAs and are enjoying an average 5% tax free return ( that's around £50K!!) a year from them. Must be nice
It's not because of stamp duty, it's not that complicated. It literally is the case of what do you invest in? Most "British" companies are American!
I think the main intention of the British ISA was to encourage (force) people to invest in UK equities rather than to just increase the ISA allowance by 5k.
I stopped investing in UK companies when the UK gov ordered HSBC to stop paying dividends in the pandemic. That level of interference makes UK stocks too risky especially if another pandemic occurs. Switched to more profitable US growth stocks with Interactive Brokers ISA which has much lower trading and FX fees than UK brokers for US stocks. No amount of Gov interference will push me back to UK stocks.
The lack of interest in ISAs might be in part due to the fact that rules keep changing. It's probably impossible to plan five years ahead in the current market of ISA products, you need to check every year for rule changes in order to change your strategy appropriately.
I disagree that the ISA rules keep changing. The basic cash Isa is the same as at the beginning except they slowly increased the amount you could put into it, the rules remained and I think then they decided you could also transfer to other providers. Having others called LISAs etc caused the problems as they seem to have rules pertaining to each type of ISA hence confusion. I say simplify and possibly add £5 k to amount to be sAved which will assist everyone especially those saving for a home. Overall there are only a small amount of people that can save the total amount so not an enormous problem tax free wise. This is from my recollections, I am happy to be contradicted or corrected! 👍🏻
@@JoeS-n8z if you insist
@@chrisbarron5861 ☺️
Feel like you’ve missed the bigger picture on a couple of points here Toby. I usually totally agree with you though …
1. 0.5% stamp duty kills big active fund managers considering the uk. While you and I might not consider it, international investment must increase if the tax is removed. Pennies to us, millions to them if they repeat trade.
2. 7% of people max ISA. They are also the people who pay the disproportionate amount of tax. I once read that 10% of people pay 25% of the tax. If this is one small incentive for high earners to stay working in this country it think it will make a difference.
I agree FTSE 100 is a big disappointment hence large % is going over sea’s. Excellent video👍
The FTSE 100 IS overseas
If people are too stupid to understand the differences between four simple ISAs... 🙄
Better schools required 😂
Brokies
Simplifying sounds great. To open an extra account for UK shares sounds confusing. Allowing partial shares inside the ISA would be a great move for people who start small. Education is key!
I viewed the British ISA idea simply as something that would make headlines for a desperate, jingoistic government increasingly reliant on selling some sort of warped 'patriotism' to the electorate.
Fundamentally, if global investors avoid UK investing then the idea that £5k - from what will be a very limited number of people in the UK able to put £25k into ISAs - will make an impact is illogical.
Personally I don't expect the ISA allowance to see an increase soon. In recent years the JISA allowance more than doubled and, including BOE (calc) inflation, the existing £20k adult rate remains a favourable uplift from its previous allowance.
One should be able to move cash easily between stock n share ISA and cash ISA just by simple transfers.
You can. You can also keep cash in a stocks ISA/SIPP platform and get interest on it. Then buy when the funds dip.
you already can!
If anyone thinks a Labour government isn’t a bigger disaster than the last few Tory efforts, wait and see, my memory of the horrors Blair and Brown inflicted are still clear.
The economy grew under New Labour as did the stock market. Unlike the last 14 years of the Tories.
I made so much money during the Blair and Brown Era.. was printing money back then.. Life was good..
@Red1Green2Blue3 that's what I thought Life was good.. Tony Blair just made a mistake with the Iraq War and being Bush's Lapdog..
@Red1Green2Blue3 The stock market grew under the Tories. You can check that for yourself.
Labour inflicted disastrous taxation policies through the LTA tax on pensions. That was absolutely disastrous because it has forced many well educated, well paid, people to retire early rather than pay the massive tax that would be inevitable if the continued working and paying into their pension.
We forced the best people out early and then failed to replace them in the workforce.
@@timg1246 You can live in a fantasy land if you want. Arguing that the economy has been better under the Tories for the last 14 years than New Labour is just delusional.
But we all know you're just here spewing petty partisan talking points. Please, tell us more about how Liz Truss crashing the gilt markets is good for investors 🤓
simplification will primarily help investment retail outlets simplify their bottom line costs too. Perhaps a good time to invest in HGL directly
You can be assured that the Labour Party will do what benefits its donors, its ideology, and its disdain for the average British citizen. I’m willing to be amazed to see they can change from their traditional strategy of tax and spend. It’s just their nature.
Unlike the sunlit uplands that Boris Liz and Kwasi achieved 😅
7% are maxing their allowance? That's not because people don't know how to invest, it's because they don't make that kind of money to get to the limit. I make above mean salary and there's no way I'm going to be able to save enough to hit the limit.
Oh I know, I was saying that the allowance limit isn't the limiting factor for ISAs :)
Thanks so much to Wendy Lee Olson, I just hit 481,000 this month. Thank you for all the knowledge and great experience you have given me over the past few months. I will always follow in your footsteps!
Wow! That’s Lovely, how do I join a group class with Wendy Lee Olson? I'm new to this and need guidance.
So you guys have work with Wendy Lee Olson that’s encouraging, I never knew she have help many people make good financial decisions and create more wealth.
I would recommend you to buy and follow the footsteps of pro to avoid losing your money in stock investments
There are many interesting stocks in many industries that you can follow. You don't have to act on every prediction, so I recommend working with a financial advisor who can guide you in choosing the best times to buy and sell stocks or ETFs you want to buy, for example.
Increasing the allowance is essentially a tax break to the top 5% - most people don't have over £20k a year to put into an ISA. I don't see why a labour government would support this...
The bottom line is that the Gov needs to cut back on the public sector spending, contrary to what Labour say, it got completely out of control under the Tories.
I could save billions, very, very quickly.
And nobody would even notice those people were not at their desks the next day.
Chancellor needs to start deducting a deficit reduction tax from public sector pension contributions to help get down the debt burden.
Everybody needs to start making some sacrifices, or this whole thing just won't work.
Public spending as a share of national income in the UK is slightly above the average of other industrial countries - the UK spends more than the US and Japan, but much less than Italy or France. With an aging, I don't see this changing, especially not considering real wage stagnation in the public sector.
What a weird tax to introduce.
@@TomsPersonalFinance Indeed, but as future taxpayers are the ones who will shoulder that burden, if you are at all interested in living in a free and fair society, then those contributions need to come in line with reality.
It isn't my opinion either, the numbers don't lie.
@GavinLawrence747 Public sector workers are taxpayers too. Their pensions aren't as amazing as they are made out to be too. The access age to get the full amount is tied to the State Pension Age, unlike private pensions. Let's not mention they're horrifically underpaid as well. If you want to live in a fair developed economy, you have to pay public sector workers fairly. Making their pensions worse will just increase their reliance on the state later down the line. Achieves nothing.
@GavinLawrence747 I do agree though. Something has to change, but I just don't know what that is!
I can't pretend I know the solution.
The 20,000 limit should at least be raised annually by inflation (as should other thresholds like the outrageous inheritance tax).
Nobody needs to inherit big money. A 90% tax on anything over £500k seems fair. It could be used to increase benefit payments for vulnerable adults and to reduce income taxes for those who graft
They raise bills with inflation, but anything good is not increased. Fair!?
£20,000 limit for ISA'S is more than enough each year -some people don't even earn £20000 per year never mind have the ability to save this sum. Place your monies into pensions and you will laughing.
A lot of people don’t trust stocks and shares ISA as they are perceived to be a risky investment as they don’t understand what you can do with them . I don’t think whatever they do will make much difference. The average person who doesn’t have an interest or isn’t motivated in this subject with always find it confusing. Even if they had money to invest, which is another issue 🙂
They are risky, doesn’t matter what you can do with them.
@@edc1569 you just kinda demonstrated my point , thanks 🙏
My take: the £20K is unlikely to be increased, the British ISA will fizzle out into the ether as it was a previous govt's idea and I can't see them capping the tax free limit on ISAs.
Labour have already said that they are in favour of it in principle so won't cancel it (Obviously will be dependent on outcome of review as to how it is implemented, same as would have been under previous government)
Really what you are saying is the “all the smart money is exiting Britain before it’s stolen”.
The real smarter money is probably noticing that ;)
I am an engineer who worked in Canary Wharf, doing engineering. You can call me a donkey, however, I was bright enough to tip the Lehman Brothers employees off to their impending doom. Of course, they all laughed and called me a “muppet”. Was not a pretty sight 3 months later when watching them in tears from All Bar One. Hugh
Mike Tyson spoke it best. “Everyone has a plan until they are punched in the mouth”. Unfortunately Labour is about to deliver a kick to the groin . Everyone laughs at the phrase “you will own nothing and be happy”. It is coming !
Stamp duty on stocks are barely a consideration when choosing which market to invest in! I agree with you
Premium Bonds are tax free and does not come under the limit allowed also you can surrender your bonds within two to three days You can have up to £50,000 in premium bonds
I think that what is putting people off on the Stocks and Shares ISA's is the fact that you may loose money, and also you got the fee's on top of that as well. Increasing the allowance to £25,000 is a good think and would support it.
If there is middle ground to be had, that I would have the first £20,000 and the final £5,000 as Stocks and Shares or variations of this.
Better would be, if you want to invest more than £20k, it's got to be in UK equities, up to another £20k.
An easy ETF containing UK stocks would do the job