The two above statements read like a perfect government tag line Vs what they really mean
I mean what I said.
Most people can grasp that you can’t go back on something you have already allowed.
And putting people back in a box is meaningless drivel.
People managed in the past without all these tax breaks.
It’s obvious to me that the state pension is not sustainable. The money has to come from somewhere.
So start paying up and the normal drivel about making the rich pay more is quite simply about envy.
Something the middle class are prone to.
You have got more than me, that’s not fair.
£100k, £20k, £10k, numbers flying out of thin air.
Next guess is £9k, why not £2k because £2k very unfair to someone saving £200…logic here is the guy next door has a bigger bowl of rice than mine; very unfair just saying. And because one knows what’s fair better than the other person (parents, teachers reinforced it , look at my good marks and transcripts, one knows everything that there is to know. Even though, you could put all the geniuses of the world in one box, even them wouldn’t be able to know more than 1% of the total knowledge in the universe….I admit that’s for another debate; sorry for the tangent, eh, maybe I am not sorry actually).
Logic on this thread is one has more, therefore, let’s take it from that person to make it “fair”, right?
And by having a quick look at history and present day with that kind of logic of “fairness”, a lot of people know how it turns out (I wish I could say most people would know, but after reading the thread in here, I wouldn’t be that optimistic).
I’ve no idea after all that what you actually believe!
“Taking” from those who have more and in effect giving to those with less is in effect the outcome of all distributive tax systems.
All of which has very little to do with a policy proposal that would only affect 2-3% of the population. The idea that this affects lower/middle classes is nonsense - wealth doesn’t equal class but even if it did the impact would be zero on the lower/middle classes as they don’t have 100k in ISAs.
ISA’s have been around for over 20 years. even with no growth you’d need to add less than £5K pa to hit 100K if you had one from the start. I think it’s highly likely that many working and middle class people have a £100K ISA
Not my figures, but those in the original article link.
The This is money podcast has given their views on the matter for anyone that is interested in listening!
Ha ha. Quite funny to read how this thread has devolved into a moral/ political debate. I can confidently say that this proposal is total nonsense. Think about it. What point would there be in setting a threshold of £100k when tax is on income ie dividends not on total amount in the ISA. How would they decide if the income from dividends you received came from the £100k or the amount above that. If I owned £100k of divided paying stocks and £100k of non dividend paying stocks could I claim that all of the income is from the first £100k. Likewise for capital gains. Did my capital gain this year come from the first £100k or the second. This is just a nonsense proposal from some who is not considering the practicalities of such a proposal. Pensions have a lifetime limit but that works because you have a defined window to withdraw them from and as pensions are effectively a means to defer tax this makes sense. You pay tax on everything you defer (other than the tax free lump sum) and once over the LTA you effectively pay back the 25% tax saving you received. This ISA proposal makes no sense for as the income has are already taxed on the way out, so it’s only the additions dividends or capital gains that can be taxed. The only route they could go is to either significantly reduce the amount you can contribute - eg to £5k or so. Or to perhaps have a max lifetime contribution of say £100k. Anything else is a unimplementable. So everyone calm down, the government is not going to mess with your savings. There are bigger fish to go after.
What they’re proposing is the maximum you can save into an ISA in your lifetime is £100k - you still won’t be paying any tax on anything held in your ISA, but you can contribute less. Did you read the document before commenting?
20k per year, but 100k accumulated maximum
I read the article, not the Resolution Foundation document if that’s what you mean. But the article is what people are commenting on. If the proposal is to cap £100k fine, although it’s still pretty unfair that some people would have been able to stuff £100k’s in their ISA’s over the years and I assume they won’t force you to with draw what’s above the cap - or try tax it - which brings me back to my point above. A cap is practical and workable but a kick in the teeth to younger savers who will mainly be affected.
Thing is though, they quoting figures of £4 billion in tax savings as if this is what the policy would recoup, but that would only be if they taxed existing ISA’s. If they just do a cap going forward the “tax savings” would be a tiny fraction of this and the impact would only materialise in many years to come. So basically pointless. So I think my point still stands that the govt might look at this but ultimately see it as unworkable or meaningless for the negativity it will create.
Neither the article or the document suggests proposing taxing existing ISAs. This is the tax they suggest would become payable on money not able to be placed in ISAs under the new more restrictive limits and as a result held in accounts not as tax friendly.
That’s fine. But in that case it’s extremely unfair that older ISA savers have had time to stuff their ISA’s so this will disproportionately affect younger savers who will be hit by the cap
If this £100k limit came in and you inherited an ISA from an older member of your family hypothetically with £750,000 inside it, would that be extremely unfair if the wealthy were passing down huge already stuffed ISA’s between their family - whilst a 19 year old right now would only be able to contribute a maximum of £100k?
you have not mention one hidden tax, called “inflation”
I think the sensible and most likely way to restrict ISAs would be to restrict the contributions allowed per year. They are already effectively doing that by keeping contribution limits steady (dropping in real terms).
You can’t inherit an ISA from a non-spouse, only the money within.
Correct. It doesn’t sit right with me that not only are people’s savings being eroded by inflation, they could be paying tax on below inflation interest
It would be subject to inheritance tax.
I don’t believe a SIPP is subject to inheritance tax though but the access rules are obviously different.