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Changes to ISAs

Changes to ISAs
From 6 April 2016 there are two changes to how ISAs are provided:

1. New ISA rules - additional flexibility
2. The new innovative finance ISA 

ISAs are Individual Savings Accounts where your interest is paid tax-free up to a set limit each tax year. The best way to think of them is as wrappers you can use to shelter savings and investments from tax.

1. ISA rules – additional flexibility
The government has introduced a new optional feature on ISAs; additional flexibility may be offered from 6 April 2016.

Normally, any money you pay into your ISA counts towards your annual ISA allowance (£15,240). With the additional flexibility you can replace withdrawals without the replacement counting towards your ISA allowance. You’ll need to pay the funds back in before the end of the tax year you take them out though.

From 6 April 2016 Santander ISAs will continue to work as they do today, we won’t be offering the additional flexibility.

If your provider chooses to offer flexibility it will apply to both current tax year and previous tax year ISA subscriptions. If you’re not sure if your ISA has this feature please check with your provider.

For further information on additional ISA flexibility click here

2. Innovative Finance ISAs
From 6 April 2016 you can save up to the annual ISA allowance (£15,240) in a cash ISA, a stocks and shares ISA, an innovative finance ISA or any combination of the three. However you can only subscribe to one of each type of ISA each tax year.

The innovative finance ISA is a new type of ISA to let savers shelter peer-to-peer lending in an ISA wrapper. (Peer-to-peer lending is when savers lend to borrowers, usually through a platform.)

Santander doesn’t offer peer–to-peer lending and therefore won’t be offering an innovative finance ISA.

Frequently asked questions

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