View more on these topics

Revenue quashes hopes of revised £50,000 ISA limit

Confusion is reigning over the exact shape of the Individual Savings Account, with wildly conflicting signals over what is up for consultation.

Product providers and trade associations were last week given hope that the controversial £50,000 lifetime savings cap would be reviewed.

In meetings with Government officials, representatives of the trade bodies were led to believe that the limit was being reassessed.

Investment and Life Assurance Group director Nicola Hayes says: "I am more optimistic now than I was this time last week. There are some very positive things in the ISA. It is not great but it is better than it could have been."

But the Treasury has acted swiftly to dampen speculation by strongly denying that there are any plans to change the lifetime contributions limit.

A Treasury spokesman says: "Number 10 has dismissed these reports as nonsense. The proposals in the consultation document are based on the £50,000 limit."

An Inland Revenue spokeswoman also denies that the limit is being reviewed. She says: "There are no plans to change the £50,000 limit.

"It is a consultation period but the Government thinks that the limit is right for spreading limited resources more fairly."

Further confusion over how the ISA will work has erupted over the details for transferring Pep money into an ISA.

The Revenue spokeswoman says investors with Peps managed by several providers will be forced to transfer the money to one ISA manager.

Life offices fear this could lead to investors being hit with huge transfer costs.

Recommended

Directors facing big pension review fines

Directors of the PIA&#39s biggest member firms face hefty fines in four months if they continue to drag their heels over the pension misselling review. The PIA has brought forward individual registration for directors of its 92 biggest members in a bid to speed up the long-running review. The contracts come into force on May […]

Micropal Top 10s

Norwich Union&#39s £53.5m Norwich American smaller companies trust is ninth out of 1,495 unit trusts over the last year, with growth of 27.88 per cent. The top 10, for so long dominated by Hong Kong trusts, emerging market funds and trackers, now includes five funds investing in North America. The NU fund, managed by Terry […]

Travelling lighter with new mobiles

Mobile computing is getting smaller and smaller. Some of the new notebook PCs being launched by Gateway 2000 and Dell are almost as powerful as many desktop machines. However, if you really want to travel light, the new range of hand-held machines look increasingly attractive. With the launch of the new Windows CE2 operating system, […]

Abuse is blamed as de minimis faces axe

The Inland Revenue is set to axe the de minimis funding limit for pension schemes, claiming that IFAs are abusing the system. The de minimis limit allows company directors to contribute up to £6,000 to their pension without having to take the Pension Schemes Office funding check. The check is a salary assessment which limits […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment