2023 has once again confirmed the importance of the whole ISA family for savers and investors.
Interest rate rises dominated headlines. They brought with them a sense of optimism and renewed focus on Cash ISAs. And we saw the startling impact of tax changes underlining why Stocks and Shares ISAs remain a core part of an investor’s portfolio.
At the start, we faced arguably the most important tax year end in a generation.
The government halved the amount of dividends you can earn before paying tax from 6 April. And at the same time, it slashed your capital gains allowance back to pre-millennium levels.
Then in June, HMRC showed that in the 2021/22 tax year:
- Almost four million people paid money into a Stocks and Shares ISA – more than any other year since 2008/09.
- Women opened more ISAs than men for the 10th year running. But they continue to lean towards adding money to a Cash ISA.
- A record £16.7bn was paid in capital gains tax (CGT) – up 15% on the year before.
And finally, in November’s autumn statement, Jeremy Hunt confirmed ISAs are set for change ahead of their 25th birthday next year.
This will include the flexibility to pay into the same type of ISAs with different providers. And allowing partial transfers between providers so current year subscriptions don’t have to be transferred in full. It also includes removing the need to reapply for existing ISAs each tax year.
It’s a great reminder that taxes change, as will you and your family’s circumstances. You don’t need to wait until next year to see if you could benefit from tax shelters, like an ISA.
With us, you can choose from a Stocks and Shares ISA, Cash ISA, Lifetime ISA, or Junior ISA for children. And you already have the flexibility to divide your ISA allowance between cash and investments.
This article isn’t personal advice. If you’re not sure of a course of action for your circumstances, please ask for advice. Remember, tax and ISA rules can change, and any benefits depend on your personal circumstances.
LEARN MORE ABOUT STOCKS AND SHARES ISAS INCLUDING CHARGES
Where have HL's Stocks and Shares ISA clients invested their money in 2023?
Below we look at the most bought actively managed funds (trying to beat the market) and tracker funds (trying to track the market), by HL's ISA investors so far in 2023. This is by number of trades (minus any sales).
This article has been written independently of our investment research team to offer some inspiration, but isn't personal advice or a guide on how or where to invest.
Investments will rise and fall in value, so you could get back less than you put in. You should choose investments based on your own objectives and attitude to risk.
| Most bought active funds (number of buys, minus sales) | Key Investor Information |
|---|---|
| Fundsmith Equity | KII |
| Jupiter India | KII |
| Rathbone Global Opportunities | KII |
| Jupiter Asian Income | KII |
| HL Adventurous Managed | KII |
| Most bought tracker funds (number of buys, minus sales) | Key Investor Information |
|---|---|
| UBS S&P 500 | KII |
| Legal & General US Index | KII |
| Legal & General International Index Trust | KII |
| Fidelity Index World | KII |
| Legal & General European Index | KII |
Regular savings are excluded. Information correct as of 20 December 2023.
How to pick ISA investments for 2024
Investing in the funds above won't be right for everyone.
You should only invest in a fund if its objectives align with your own, and there's a specific need for that type of investment within your portfolio. Investors should understand the specific risks and charges of a fund before they invest and be investing for the long term (five years or more).
It's also important not to put all your eggs in one basket. Spreading your money and diversifying gives you access to more opportunities and can reduce risk.
If you're looking for inspiration on where to invest in 2024, our experts have handpicked five funds to watch for 2024 and beyond.
See our 5 funds to watch for 2024
Or you can use our Wealth Shortlist. It's designed to help investors build and maintain a well-balanced and diversified portfolio. We've put funds under the microscope to make sure the list only contains the funds that our in-depth analysis shows have the greatest long-term performance potential.
If you don't feel comfortable building and maintaining a portfolio, take a look at our ready-made portfolios. These all-in-one portfolio funds let you choose how to balance risk and potential returns from four options. HL’s investment experts will make the day-to-day investment decisions from there.
All you'll need to do is review your investments every now and then to make sure they still meet your needs and objectives.
HL’s fund ranges are managed by our sister company, Hargreaves Lansdown Fund Managers Ltd.
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Before you apply, please make sure you're happy with our terms and conditions (including Tariff of Charges) and key features. Then all you need is your debit card and national insurance number to hand.
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Looking to invest but unsure where to start? Our all-in-one funds could help.
With four to choose from, you can pick the investment most suited to you.
The HL fund range is managed by our sister company, Hargreaves Lansdown Fund Managers.
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