This change affects those who own life assurance policies, capital redemption policies and life annuity contracts. The rules for calculating the amount of gains from the relevant policies and contracts are amended. The changes apply where there have been gains earlier in the life of the policy or contract but the gains were not chargeable to tax under the income tax rules. The changes seek to clarify the rules for calculating the amount of gains liable to income tax. This measure is introduced as a result of HMRC's view that the previous rules were, in some instances, exploited.
The cash value of the ISA limit has increased from £10,680 in 2011/12 to £11,280 in 2012/13. Up to half of the allowance may be saved in cash.
The following changes were confirmed today:
- The limits which currently apply to Enterprise Investment Schemes (EIS) and Venture Capital Trusts (VCTs) will be increased as follows:
- The rules for EIS and VCTs will be simplified so that: