Savings and Investments - Individual Savings Accounts ISAs – Personal Equity Plans PEPs 2008/09

ISAs and PEPs

Notes

1. Under the government's stakeholder scheme, the make up of an ISA can be split between cash and longer term investments. These can be held in the following proportions:
   
   
   • Cash ISA - (up to £3,600)
   • Stocks and shares ISA (the remainder of the £7,200 not held as cash deposits.)
   
   
2. For qualifying ISAs, all returns received are free from income tax and capital gains taxes.
3. An age restriction applies to 16-17 year olds who are restricted to contributing up to £3,600 only, in a cash based ISA.
4. ISAs permit individuals to withdraw capital as and when they wish without giving rise to a a charge or without forfeiting tax reliefs. Furthermore, any capital gains and income derived from an ISA need not be included on a self assessment tax return.

Personal Equity Plans (PEPs)

All outstanding PEPs in existence as at 6 April 2008 are automatically transferred to equity based ISA.