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Dear tutor,
I have a question: One relief from ISA is that the income is exempt from income tax.
But why in the text book, it’s said: “Cash ISAs: This includes bank and building society accounts, as well as those NS&I products where the income is not exempt from tax. ”
It does not make sense to me. So is it a conflict here? Or the textbook has some typo?
Thank you!
I agree it seems a little confusing! Income arising in an ISA is exempt from income tax. You can also take out an ISA with NS&I (National Savings and Investments) in which case it enjoys the same exemption as any other ISA. Most ‘normal’ NS&I income is taxable (with some exceptions such as income from National Savings Certificates). I hope that helps to clear things up.
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