Paywalledā¦ but from what Iāve read elsewhere it sounds like a disaster.
Ā£100k lifetime allowance?!??
Yeah, they would love to do that as it targets money from younger people, who vote less, to fund their bribery to pensioners with the triple lock.
Any updates on this?
Thanks
Presumably many newer platforms including T212 would be affected by this.
Would this affect any holding that isnāt owned in whole, discreet units? For example, if you owned 2.5 units of a share/ETF, this would count as a fractional shares?
Iād be interested to hear from someone more knowledgeable than me in this area why the fractional shares would not be considered as ādepositary interestsā and permitted within ISAs on that basis. Regulation 7(2)(ha) allows them in S&S ISAs, and regulation 2(1) defines them very broadly:
āthe rights of the person mentioned in paragraph (b), under a certificate OR OTHER RECORD (whether or not in the form of a document) acknowledging:
(a) that a person holds relevant investments [which, on HMRCās case, would be whole shares] or evidence of the right to them, and
(b) that another person IS ENTITLED TO RIGHTS IN OR IN RELATION TO those or identical investmentsā¦ from the person mentioned in paragraph (a).ā
In the worst case, Iād expect that to leave ISA providers (the person in (a)) on the hook for one fractional share of each holding on their platform, as (b) seems to permit the individual entitlements to be fractionalised.
Hi all, just to let you know, that weāve heard your questions and are staying very close to the story. Weāll come back to you with a full update next week.
Like many others are calling for, and believe will happen, weāre aiming for an amendment of the out-of-date rules in the coming Autumn Statement. Weāre working with the necessary parties and submitting representation this week to the treasurary in support of this.
The former head of tax at Clifford Chance, who is very well thought of among tax practitioners, essentially agrees (although doesnāt specifically bring up the eligibility of depositary interests and focuses on how he interprets āsharesā in this contextā¦ But he basically describes depositary interests in doing so): https://twitter.com/DanNeidle/status/1712397664203973028?t=Rx3pzlSQJ5akdD6QVv7kCw&s=19
More weight against HMRCās position.
He believes ETFs and unit trusts are different in the scope of the regs than fractional shares. Iād be interested if this means IEs service will be impacted differently to others, or perhaps not at all.
Dan Neidle doesnāt agree with the HMRC position;
Representations for Autumn Statement 2023 can be made. I found this on the FreeTrade Community with a template to send.
Closing date is 5pm Tomorrow.
I have made a Gov UK petition and need 5 signatures before the petition goes live
I would welcome people private messaging me and I will sent the link to the first 5 people I get in a 1st come, first served basis.
Update: now only need 2 as 3 have taken me up on it.
I hear that once this step has been cleared, it takes a week or less for that actual petition to go public for anyone to sign
The wording shall be as follows
Allow fractional shares to be held in an ISA
After years of this being de facto allowed. HMRC is now quoting regulation dating back to the 70ās to claim fractional shares are not allowed in S&S ISA accounts. We believe this is a backwards move that may make investment in the UK dry up unnecessarily.
We believe this will penalise smaller investors who are building their investment pot. It could also damage confidence in investment and investing and mean that more people might be tempted to either give up investment if they are now to be taxed on something they thought was an account free of capital gains and dividend taxes. The talk of potential fines further stands to damage the confidence of retail investors who are beginning thier investment journey.
Thanks in advance
Due to character limitations I had to stick to the most pertinent points.
Iāve just signed it. Have you posted it on the other platforms community groups? I think theyāre generally bigger and could get you more signatures.
Signed the petition, thanks for posting
Hi
Yes have posted on both Freetrade and 212 forums as well.
Canāt sign - says needs to be reviewed