New tax year – make the most of your ISA allowance
Don’t forget, the start of the new tax year means your individual savings account (ISA) allowance resets again on 6th April 2021 to £20,000 (2021/22). So, if you have cash that you won’t need to access in the short term, take advantage of this opportunity to save up to £20,000 tax efficiently.
You can save up to £20,000 into a cash ISA or a stocks and shares ISA. Or if you prefer to mix and match by investing in both, and can do so, providing the total combined amount doesn’t exceed the annual allowance of £20,000.
You can’t carry any unused allowance over to the next tax year – it resets every year. And any allowance that’s not used by the end of the tax year will be lost.
Now, more than ever, you’ll want to make sure your savings give you the best possible return. Putting money aside tax-free is an easy way to make your savings work that bit harder and is especially useful for those in higher tax bands who don’t benefit from the personal savings allowance.
Remember, the value of your investment can go down as well as up so you might not get back the amount you put in. Also, tax rules can change and the impact of taxation (and any tax relief) depends on your circumstances.
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