And how you can still invest in the UK equities.
Plans for a new British ISA, as laid out by former Chancellor of the Exchequer, Jeremy Hunt, have reportedly been scrapped under the new Labour Government.
Unveiled earlier this year as part of the 2024 Spring Budget, it was suggested a British ISA could increase the flow of capital into domestic markets by generating more opportunities for people to invest tax-free in UK assets.
However, the idea has drawn criticism for overcomplicating the investing process.
“The British ISA was rife with issues and the proposals ran the risk of consumer confusion or poor outcomes,” said Shaun Moore, Tax and Financial Planning Expert at wealth management company, Quilter.
This sentiment is echoed by Dan Olley, Chief Executive Officer at Hargreaves Lansdown, who said the savings and investment platform was “pleased” the Government won’t be pursuing plans for a British ISA as “simplicity is key when it comes to getting people to start investing”.
“Our data clearly shows that British retail investors are already enthusiastic backers of British companies,” Olley added, revealing that, of the equities held on the Hargreaves Lansdown platform, 80% of trades in the past year were on the London markets.
How to invest in the UK equities
Those eager to invest in the UK market can continue to do so using a stocks and shares ISA, with any gains automatically exempt from Capital Gains Tax (CGT) and Income Tax.
If you opt for a self-select stocks and shares ISA, you’ll be responsible for choosing your investments and, with careful research, you can purchase UK equities. Alternatively, if you have a fund or account manager oversee your portfolio, you can ask them to invest your money in UK stocks.
However, as is always the case with investing, it’s important to remember your capital is at risk and returns aren’t guaranteed. Past performance is never indicative of future returns and it’s possible your investment could lose value. If in doubt, consider seeking expert advice.
