Key facts
- HMRC plans to tax cash interest in stocks and shares Isas.
- The tax rate will be 22%.
- The new tax will apply from April 2027.
- The aim is to encourage investment and prevent cash hoarding.
- New rules for first-time buyer Isas are also being introduced.
HM Revenue and Customs (HMRC) has announced forthcoming plans to implement a 22% tax on interest earned from cash held within stocks and shares Individual Savings Accounts (Isas). This new taxation policy is scheduled to take effect from April 2027. The primary objectives behind this policy shift are to actively encourage greater investment within the stock market and to deter individuals from holding substantial amounts of uninvested cash within their Isas. Furthermore, the announcement also indicates the introduction of new rules specifically tailored for first-time buyer Isas, suggesting a broader reform of the Isa system. The intention is to streamline the process and potentially offer enhanced benefits or clearer guidelines for those seeking to purchase their first home.