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Shareholders

Answer

Large investment funds effectively comprise the investments of individuals, whether via their pension funds, insurance contracts, or other savings and investment products. The decision to invest in companies’ shares directly, or indirectly through a fund, is a matter for individual investors.

The Government has taken a variety of steps to encourage individual saving, and retail investment in shares in particular. For example, we have:

- Reduced the starting rate of income tax for savings;

- Increased the maximum annual amount which can be invested in an Individual Savings Account (ISA) to £15,240 in the 2015-16 tax year, and provided savers with greater flexibility to withdraw their money and put it back in to an ISA within the same year, without losing their tax benefits;

- Introduced, from April 2016, a new tax-free Personal Savings Allowance of £1,000 (or £500 for higher rate taxpayers) of interest earned on savings (taking 95 per cent of taxpayers out of savings tax altogether) as well as a new £5,000 tax-free dividend allowance for all taxpayers;

- Allowed shares from growth markets such as the Alternative Investment Market (AIM) to be held in ISAs - making investment in the growth markets easier;

- Abolished stamp duty on AIM shares, attracting further investment into growing companies and reducing the cost of raising capital for those companies.

Secondary information

Type

Written question

Reference

9998

Session

2015-16

Transferred

Yes

Subjects

Investment trusts Shareholders

Link

View this Written question on www.parliament.uk