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A QUICK GUIDE TO ISAs FROM TRANSACT
Tax-efficient wrappers such as ISAs can play a vital part in the financial planning process. By offering tax-free investment opportunities, ISAs are an effective vehicle to help you maximise your clients’ tax-free savings potential – whether planning for their future savings, pension, house purchase or even to help them support other members of their family.
ISAs are a good solution for high earning clients who are looking to maximise tax-free saving, who have used all of their annual allowance or have pension savings approaching the lifetime allowance.
Transact’s wide range of ISAs includes both Cash and Stocks & Shares ISAs (which offer ISA flexibility, detailed below), as well as the Junior ISA and Lifetime ISA. This range of wrappers makes us an ideal platform to facilitate intergenerational planning and effective tax planning in today’s financial market.
To help you make the most of your clients’ ISA allowance, we have put together a simple guide to explain the ISA options available with Transact, and to better support you in promoting these products to your clients.
- Cash ISA – cash can be saved in a tax-efficient way with immediate access to the cash at any time.
- Stocks & Shares ISA – invest in stocks and shares in a tax-efficient way over the medium to long term (usually at least 5 years) with access to the assets at any time.
- Lifetime ISA – save towards a first home or retirement, while aged 18-39, with a government bonus of 25% on contributions up to age 50.
- Junior Cash ISA – save cash in a tax-efficient way on behalf of an eligible child. Subscriptions are accessible by the child once they reach 18.
- Junior Stocks & Shares ISA – invest in stocks and shares in a tax-efficient way on behalf of an eligible child over the medium to long term (usually at least 5 years). The subscriptions are accessible by the child once they reach 18.
This flexibility is available with Transact on the following ISAs:
- Cash ISA
- Stocks & Shares ISA
The JISA annual subscription limit is £9,000 for the 2020/21 tax year.
Transferring an existing ISA to Transact is easy. For existing Transact clients, simply fill in a transfer form (T004 for ISAs or T040 for JISAs) and submit this to Transact. We will take care of the rest by liaising with the client’s current ISA provider to facilitate the transfer.
For persons looking to switch their portfolio to Transact and subsequently open an ISA, they will first need to follow the Transact portfolio application process and submit the relevant transfer form as part of the application.
We charge a fee of £3 per quarter for holding an ISA on Transact. Where a client holds more than one ISA, they will be charged the ISA fee only once per quarter.
TRANSACT ISA RANGE OVERVIEW
|Cash ISA||Stocks & Shares ISA||Lifetime ISA||Junior ISA
(Cash, Stocks & Shares)
|How much can currently be saved or invested each year?||Up to £20,000 – less any already contributed to other ISA types in the same tax year.||Up to £20,000 – less any already contributed to other ISA types in the same tax year.||Up to £4,000 provided you have not paid in over £16,000 into other types of ISA in the same tax year.||Up to £9,000 which can be divided between subscriptions to a cash JISA and stocks and shares JISA.|
|Who is eligible?||UK residents over 16 years of age – or Crown servant or their spouse/civil partner if not living in UK.||UK residents over 18 years of age – or Crown servant or their spouse/civil partner if not living in UK.||UK residents aged 18 to 39 – or Crown servant or their spouse/civil partner if not living in UK. Contributions can continue up to age 50.||UK residents under 18 years of age – or Crown servant or their spouse/civil partner if not living in UK. A Registered Contact must open the account on behalf of the child and must have legal parental responsibility for the child.|
|Which applications to use for existing clients?||T008-C Cash ISA||T008-S Stocks and Shares ISA||T008-L Lifetime ISA||T038 JISA|
Application forms for new clients
New clients must apply to open a portfolio with us before applying for an ISA. As well as the above, a T001 portfolio application form must be completed by the client and adviser. Anti-money laundering (AML) checks will be carried out as standard on all new applicants.
Anything else I should know?
Full details on each of our ISA products are available in the Key Features Documents and Terms and Conditions for each product. All documents and forms are available by logging into Transact Online and going to Information > Transact Forms and Documents.
For the JISA, the Registered Contact will also be subject to AML checks if they are not currently an existing Transact client, and they will need to complete a T048 form to provide their details.
Find out more
To find out more about the Transact range of wrappers or any aspect of our business:020 7608 5350
Lines are open Monday to Friday, 8am to 6pm (excluding bank holidays). Calls may be recorded.