What Is the ISA Allowance Cut Off Date?


We all know how important it is to make the most of any tax-free savings allowance offered to us by the government. One way to do this is to make full use of your annual ISA allowance. But what is the cut off date for your annual ISA allowance, and how can you make the best use of your money?

Cut Off Date for Your Annual ISA Allowance

Every year, your tax-free ISA allowance renews, allowing you to invest more tax-free cash. In the 2019-2020 tax year, you can invest up to £20,000 tax-free when you save or invest your money into a Cash or Stocks and Shares ISA. If you still have some of your ISA allowance remaining for the current tax year, then the cut off date for you to invest or save this cash is the 5th of April 2020. If you don’t place your cash into an ISA before this date, then you will lose this potential tax-free savings allowance and, unfortunately, it will not rollover into the next year.

Stocks and Shares ISA or Cash ISA?

When most people think of ISAs they generally think of a standard type of savings account, where you place your money into an ISA account and you then receive interest on your savings. This would be referred to as a ‘Cash ISA’. Nowadays, online ISA providers like enable you to open a Cash ISA online in just a few minutes.

Although Cash ISAs are suitable for some, many people also choose to invest in a Stocks and Shares ISA or in a mix of the two ISA types.

Stocks and Shares ISAs allow you to invest your cash tax-free, allowing you to invest in stock markets with the hope of getting a better return on your cash than you might if you put your money into a Cash ISA.

With a Stocks and Shares ISA, you can either manage your own investments 100% or you might prefer to invest on autopilot with an ISA from a robo-advisor.

Whether you choose to go for a Cash ISA or a Stocks and Shares ISA will usually depend on your attitude to risk. If you are extremely risk averse then you may be better off sticking with a Cash ISA and accept the current savings rates on offer. If you don’t mind taking a little risk with the hope of greater returns, however, then a Stocks and Shares ISA will allow you to do this and might therefore be for you.

You will also be investing in the stock market with some added tax benefits that wouldn’t exist if you were to invest directly through a standard share dealing account, such as your investments being free from Capital Gains Tax, for example.

Don’t Miss Out!

So, now that you know the ISA allowance cut-off date, be sure not to miss it! It’s well worth keeping in mind that your allowance will not roll over into the following tax year. So, once April 5th has passed, your ISA allowance for that tax year will be lost.

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