Comment from TISA, the financial services membership association, in response to the Budget
Commenting on the increased ISA allowance and the introduction of the Lifetime ISA, Carol Knight, Chief Operations Officer of TISA said:
“We welcome the extension of the individual ISA allowance from £15,400 to £20,000 from April 2017. The popularity of ISAs has continued to grow since their introduction in April 1999 and this builds on the Help to Buy: ISA implemented earlier this year.
“The Lifetime ISA will encourage further tax-exempt saving and a dedicated account to save for a home and save for retirement. This is a much needed incentive for those who currently find it hard to save to consider doing so and to kick-start a savings habit.
“The introduction of a Lifetime ISA, with its generous Government contribution of £1 for every £4 saved up to an annual limit of £4,000 per person, will help younger people to save for the long-term. It is great for savers that they will be able to transfer savings from a Help to Buy: ISA to the new Lifetime ISA from 2017, or continue to save into both.
“We are delighted with the flexibility offered by the Lifetime ISA which enables individuals to save as much or as little as they wish each month and gives them greater control of their finances.
“This builds on a policy that our savings and investments policy project1 has been calling for as a means to encourage more people to save whilst also trying to buy a house. Individual accounts mean that two first time buyers can benefit when buying a property together.
“Overall, the Lifetime ISA is a great help towards retirement saving, however, we are a little disappointed that early withdrawals will incur a 5% levy and would like greater clarification on this point.
“We look forward to working with the Government, industry and trade bodies in the consultation around this policy.”
For further information please contact:
Alistair Kellie / Sara Neidle / Nick Morris – Telephone: 020 7680 6550 / Email Alistair.Kellie@newgatecomms.com; Sara. Neidle@newgatecomms.com;
Email: TISA@newgatecomms.com
Notes for EditorsTISA is a not-for-profit membership association operating within the financial services industry. The focus of our recommendations and actions is improved outcomes for consumers and UK plc with this approach leading to a stronger UK financial services industry.
TISA’s growing membership comprises over 150 firms involved in the supply and distribution of savings and investment products and services. These members represent many different sectors of the financial services industry, including asset managers, insurance companies, fund managers, distributors, building societies, investment managers, third party administrators, consultants and advisers, software providers, financial advisers, pension providers, banks and stockbrokers.
Having a legacy of focusing predominantly within the tax incentivised products area, TISA has in recent years moved into the broader savings and investments world, extending our standing as trusted adviser over a much greater remit.
TISA has a successful track record in working cooperatively with government, regulators, HMT, DWP and HMRC to improve the performance of the industry and the outcomes for the public. Effective policy and regulation and the creation of efficient industry infrastructure continues to be the major focus for our members. TISA is unique in that it represents the entire financial services industry, incorporating cross-sector policy, industry and technical expertise. Whilst we maintain a solid partnership with government, the regulators and wider industry, we remain independent and develop neutral views and opinions. This impartiality is reflected in our ability to drive development projects which improve industry performance and consumer outcomes, putting us in the unique position of being able to constantly challenge the status quo to bring about material improvement.
1 The Savings and Investments Policy project is working with a wide range of financial service companies, trade bodies and consumer groups to develop these pan-industry proposals. It is directed by an Executive Committee formed of 19 leading financial services companies including Aviva, AXA Wealth, BlackRock, BNY Mellon, Columbia Threadneedle, EY, Genpact, Henderson Global Investors, Invesco Perpetual, J.P. Morgan Asset Management, Legal & General, Lloyds Banking Group, Nationwide, Northern Trust, Old Mutual, Openwork, Pinsent Masons, RBS and TISA.
Website: www.tisa.uk.com