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BREAKING: The UK just confirmed a 22% tax on interest earned from cash sitting inside Stocks and Shares ISAs, starting 6 April 2027.
An ISA was supposed to mean one thing: money grows completely tax-free.
A Stocks and Shares ISA holds investments, but people often leave cash sitting inside it too, uninvested, just earning interest, tax-free until now.
Next year, the Cash ISA allowance for under-65s gets cut from £20,000 to £12,000. To stop savers from working around that, HMRC is locking down every option:
- Cash held in a Stocks and Shares ISA now gets taxed 22% on its interest.
- You can no longer move money from a Stocks and Shares ISA into a Cash ISA.
- You can no longer hold an entire non-Cash ISA in cash like funds either.
Example: £40,000 sitting as cash inside a Stocks and Shares ISA earning 4.5% makes £1,800 a year. From April 2027, £396 of that goes straight to HMRC, leaving £1,404.
So the government is taxing a savings habit people have used for 27 years, while building in a higher allowance for one age group only.
We are working with some truly talented Ugandan audio/visual geniuses!
@LoukmanAli - big yourself up for this brilliant piece of work.
Come let’s work for Uganda!