Bringing you live news and features since 2006 


ISA investors pay unnecessary GBP80 a year to tax man


UK investors using their full ISA allowance to invest in a property fund pay GBP80 a year in unnecessary tax, which they would avoid in a tax-efficient fund, according to the Investment Management Association (IMA). Looking at property funds within ISAs, some GBP1.6 million a year is paid to the taxman instead of to end investors. Pension funds are also hit by this tax.

Following detailed discussions between the IMA and the Treasury, new tax-efficient funds (tax-elected funds or TEFs) and “property authorised investment funds” (PAIFs)) have been introduced to ensure that individual investors do not indirectly suffer corporation tax. However, TEFs and PAIFs are not yet available on many retail fund platforms.

“As we approach the ISA season, it is unfortunate that ordinary ISA investors are missing out on investing in tax-efficient funds, because these funds are not yet available on many retail platforms," says Richard Saunders, Chief Executive of IMA. “A number of managers are keen to launch tax-efficient funds but are discouraged by the current inability of platforms to carry these funds.

“We call upon all industry participants to facilitate the development of tax-efficient funds.  Investors need to demand access and advisers need to press for launches.  Platforms and administrators need to put in place the necessary systems to ensure investors no longer pay an unnecessary tax on investing.”




Latest News

US ETF issuers of active ETFs are facing an increase in fees from the big custodian firms, such as Charles..
ETF data consultant ETFGI reports that assets invested in the global ETF industry reached a new record of USD12.71 trillion..
Calastone has published an ETF white paper which examines several of the processes that take place across the lifecycle of..
Adapting product lines to fit into changing methodologies and meet shifting demand is essential to remaining relevant in the industry..

Related Articles

Taylor Krystkowiak, Themes ETFs
Themes ETFs opened its doors in December 2023, with an introductory suite of 11 ETFs – seven thematic and four...
Konrad Sippel, Solactive
At the end of March, financial index specialist, Solactive, published its 2024 annual report on future trends.  ...
Lorraine Sereyjol-Garros, BNP Paribas
Following changes to the French Monetary and Financial Code and of the French market authority AMF’s General Regulation, it is...
Ed Rosenberg, Texas Capital
Texas Capital Bank first opened its doors back in December 1998 and nowadays offers wealth-management services, as well as commercial,...
Subscribe to the ETF Express newsletter

Subscribe for access to our weekly newsletter, newsletter archive, updates on the site and exclusive email content.

Marketing by