LCF ISA Voided by HMRC - What Happens Now?

By J Drew -

 Investors in London Capital & Finance ISAs may have recently received an email from HMRC that they thought to be a scam message but in reality was genuine.

HMRC previously stated that the LCF ISAs that were not actually ISAs because the bonds LCF sold were not a valid ISA product had been voided meaning that the investors would have lost that ISA allowance even if they had been compensated by FSCS or HM Treasury.

HMRC have now come to the common sense conclusion that the bonds inside the ISA wrapper were voided but the ISA wrapper itself remains valid. 

This means that anyone who invested in an LCF ISA will still have an allowance for the value of the compensation that they receive from FSCS or the government.

The email explains the steps that need to be taken to ensure that the ISA allowance isn't lost although this is probably only really relevant for anyone who invested substantially above the annual £20,000 ISA limit. If you invested £5,000 you can just pay the money into an ISA using this year's limit anyway. With £68,000 that isn't possible.



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