2 key deadlines to consider before the end of the tax year

As the end of the tax year approaches, there are plenty of deadlines to keep in mind. One important deadline is that of investing in an Individual Savings Account (ISA).

ISAs are a type of tax-efficient savings account available to UK residents. ISAs were introduced in 1999 to encourage saving and investing, and have since become a popular way for individuals to save for their future. 

In this article you can read about the rules and benefits of ISAs, as well as understand why we are introducing an internal deadline for submitting subscriptions.

4 important rules to remember when opening an ISA

ISAs come in several different forms, including:

• Cash ISA
• Stocks and Shares ISA
• Innovative Finance ISA
• Lifetime ISA (LISA) 

Each type has its own rules and limits, but there are some general rules that apply to all ISAs. Here are four key ISA rules to remember.

1. You must be a UK resident, and over the age of 18, to open a Stocks and Shares ISA. You can open a Cash ISA from the age of 16. Innovative Finance ISAs and LISAs have different age restrictions, including the fact you must be under 40 to open a LISA.
2. You can only contribute a certain amount of money to your ISAs each year. For the 2022/23 tax year, the annual ISA allowance is £20,000, although individual account restrictions apply. For example, the annual LISA limit is £4,000 – but you can still contribute the additional £16,000 across other ISAs you hold.
3. You can only contribute to one of each type of ISA in any given tax year. For example, if you open a Cash ISA and pay into it, you cannot pay into a separate Cash ISA within that same year.
4. Any money you put into an ISA is generally tax-efficient, as you don’t pay Income Tax or Capital Gains Tax (CGT) on the interest or returns you earn. This can make a big difference to the amount you save over time.

4 amazing benefits of ISAs

ISAs offer several benefits to savers and investors. Here are four of the main advantages they can bring to your wealth. 

1. Tax-efficient savings. As mentioned above, any money you save or invest in an ISA is tax-efficient. This can help your savings grow faster over time, as you’re not losing any of your earnings to tax.
2. Flexible options. With several different types of ISA available, you can choose the one that best suits your needs. Cash ISAs can be a good option for short-term savings, while Stocks and Shares ISAs offer the potential for higher returns over the long term.
3. No time limits. Unlike other savings accounts, there’s no set time limit for how long you can hold an ISA. You can keep your money in there for as long as you like, and continue to benefit from the tax-efficient savings.
4. Easy access. With most Cash ISAs, you can withdraw your money at any time without penalty. This can make them a good option for both emergency funds and short-term savings goals, depending on the type of ISA you open. An exception to this rule would be the LISA, which is designed only for first-time buyers or those who wish to save for retirement.

For a more comprehensive breakdown of the rules, regulations, and benefits of ISAs, download our complete guide to ISAs today.

Everything you need to know about our internal ISA deadline 

We are fast approaching the 2023 tax year end and, as always, there is a flurry of activity in the financial world. Understandably, many people want to take full advantage of the tax allowances and reliefs that are available up until 5 April.

Here at Chancellor, we want to remind you of some key dates, to ensure that you can maximise these opportunities where possible.

We feel it’s important to set an internal deadline for when you can submit your ISA subscriptions, to make sure the provider receives the documentation and can process it on time. 

In doing this, we can also avoid last-minute rushes, and reduce the risk of errors or delays at the busiest time of the year. 

2 key deadlines to consider before the end of the 2022/23 tax year

1. ISAs

If, as a Chancellor client, you are thinking of topping up your ISA and want to move money from an investment account over to your ISA (known in the industry as “Bed and ISA”), then the process needs to be completed by Monday 20 March to allow the transaction to complete. 

If you are setting up an ISA for the first time, then we will need to have your account set up to receive money no later than Friday 31 March. 

Finally, if you want to review your ISA arrangements, whether this is to discuss an existing account or make additional investments before the deadline, please get in touch with your adviser as soon as possible.

2. Pensions

If you want to make a contribution to your pension arrangement in the 2022/23 tax year, while most providers will accept cheques and bank transfers right up to the 5 April, we recommend that you act now. At the very latest, it would be wise to have your documentation and payment method in place by Friday 31 March.

Please bear in mind certain banks won’t allow transfers of more than £10,000 at one time, so multiple transfers may be required.

It is important to note that the deadlines above apply to all clients who wish to make subscriptions to their ISA through Chancellor. 

We will be in touch with you before this date to see if you would like to make a subscription if you have not already taken advantage of the full allowance. 

Of course, should you wish to make a subscription after this date, we will do our very best to process it before 5 April, but we cannot guarantee the process will be completed by the end of the tax year. 

Get in touch

To discuss starting or contributing into an ISA or pension before the end of the tax year, get in touch. Email info@chancellorfinancial.co.uk, or call 01204 526 846 to speak to an adviser.

If you’re already a client here at Chancellor, contact your personal financial adviser to discuss any of the content you’ve read in this article.

Please note

This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

The Financial Conduct Authority do not regulate cashflow planning.

This article is for information only. Please do not act based on anything you might read in this article. All contents are based on our understanding of HMRC legislation, which is subject to change.

The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance. Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial circumstances.