Despite various warnings and explanations of the imminent ISA changes, investors remain baffled. New research from Barclays Stockbrokers has revealed that less than 40 per cent of investors are aware of how the changes will affect their investments.
Out of those questioned, Barclays Stockbrokers found that less than three quarters were aware that the investment limit for an ISA
will increase on April 6th.
Of those who currently hold a Personal Equity Plan (PEP) only 45 per cent were aware that, on April 6th, PEPs will automatically become Stocks and Shares ISAs.
In becoming Stocks and Shares ISAs, PEPs will become easier to manage for investors because it will be possible to consolidate PEPs and ISAs into one account. By doing this, costs will be reduced and accounts will be less hassle to juggle.
Despite these advantages, only four in ten of those investors questioned claimed to be fully aware of how the changes will benefit them. Tom Ryan, Director at Barclays Stockbrokers, said: "It is astonishing that despite the new regulation almost upon us, a large number of ISA investors are still unaware of the forthcoming changes to PEPs and ISAs.
These changes to regulation present a real opportunity for investors to reduce costs, and with effect from April 6th they will be able to protect more of their savings from tax by investing up to £7,200 into their Stocks and Shares ISA," Mr. Ryan concluded.
Meanwhile, as the new tax year and new ISA regulations approach, Abbey urges future investors to beware of hidden catches and costly snags such as restrictive Cash ISA transfers. According to new research by Abbey, one in six ISA accounts does not allow transfers in, which can hinder tax free savings potential.
Reza Attar-Zadeh, Director of Savings and Investments at Abbey, said: "With the average transfer balance of Cash ISAs at £12,000, savers need to look carefully at the transfer conditions on Cash ISAs. By not allowing transfers in, customers cannot benefit from a leading rate and are restricted to the tax free benefits of just £3,000 this tax year and £3,600 next."
If you are still unsure about the ISA changes and what they mean for you, read our free Guide to ISA changes
. Packed with all the information you need, in an easy to understand format, our free guide will ensure you are clued up by April 6th.
© Fair Investment Company Ltd