Ways to save in 2017
Saving options available in 2017
HM Treasury and HM Revenue & Customs have put together a handy guide to make your money go further in 2017. It offers you a look at ahead at the many easy and tax efficient ways you can save your money. The list takes you through life’s milestones, highlighting ISAs and other savings options along the way.
Junior ISAs are long-term, tax-free savings accounts for under 18s, who do not currently have a Child Trust Fund. Children can currently save or invest up to £4,080 per tax year and this is due to rise to £4,128 from April 2017. The account then gets converted to an Adult ISA on the child’s 18th birthday. Children between the ages of 16 and 18 can have both a Junior ISA as well as a basic ISA.
Help to Buy ISA
Help to Buy ISAs help first-time buyers get on the property ladder, with a government top-up of 25%. With maximum savings of £12,000, a saver would receive up to a £3,000 government contribution! The bonus can be used to help purchase a home up to the value of £250,000 outside London, or £400,000 within London.
The new Lifetime ISA is due to launch in April 2017 and will help those aged between 18 and 40 to save for life’s big events. Savers are able to withdraw the funds from the ISA tax-free for a deposit on a first home worth up to £450,000 or from age 60 for any other purpose. The Government will add 25% to the amount saved – subject to a maximum of £4,000 per year – potentially worth an additional £1,000 each year.
Premium Bonds from National Savings and Investments (NS&I) are a savings product that doesn’t pay interest but offer tax-free returns in the form of a monthly prize draw. The minimum investment is £100 per person. An interest rate of 1.25% is used to calculate the prize fund but returns are not guaranteed.
ISAs – Individual Savings Accounts
All ISA accounts are free from Income Tax and Capital Gains Tax. Savers can choose to hold their full allowance in a cash ISA, stocks and shares ISA, innovative finance ISA, or a combination of all three. Account holders may make withdrawals at any time without the loss of tax relief. The ISA subscription limit for the current tax year is £15,240 and is due to increase to £20,000 in April 2017.
If you would like to discuss your tax-efficient saving opportunities any further then please get in touch with a member of our Wealth Management team on 01903 234094.