Tax Rates 2004   Tax Rates 2004 Graphic
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Savings and Investment

Individual Savings Accounts (ISAs)

Maximum investment 2004/05:               £7,000

Notes

  1. With effect from 6 April 2004 the dividend tax credit of 10% can no longer be reclaimed.

  2. Investment in a "maxi ISA" is subject to an overall limit of £7,000 in 2004/05. Of this, up to £3,000 can be in cash (National Savings, etc) and up to £1,000 can be in life insurance. The balance, up to the overall limit, can be invested in stocks and shares. Thus, for example, £500 could be invested in National Savings, £250 in life insurance, and the balance - up to £6,250 - could be invested in stocks and shares.

  3. Investment in up to three "mini ISAs" is also subject to the £7,000 limit, but the amount which can be invested in each mini ISA is capped - £3,000 for cash, £1,000 for life insurance and £3,000 in stocks and shares.

  4. Investments in ISAs are free of income tax and capital gains and higher rate tax free. (but see 1 above)

  5. Those aged 16-17 can invest up to £3,000 only, either in the cash element of a maxi-ISA or in a cash mini-ISA.

Personal Equity Plans

Although PEPs are no longer available, sums already invested continue to score for tax breaks.