Individual Savings Plans: Who Qualifies and What You Get
Learn how Individual Savings Plans allow you to avoid capital gains tax on your investments if you follow specific rules and timelines.
Individual Savings Plans are investment vehicles designed to encourage long-term saving through tax incentives.
Who it's for
This scheme is available to individual investors. You are only allowed to hold one plan per person.
What you get
If you hold your investments within the plan for at least five years, you are exempt from capital gains tax. This means the government will not take a percentage of your investment profits when you eventually sell them.
What it costs you
To receive these tax benefits, you must follow strict rules regarding where your money is invested. Your portfolio must adhere to specific composition rules, primarily focusing on Italian or EU stocks.
The catch to know
The tax exemption is tied strictly to a five-year timeline. If you decide to withdraw your funds before the five-year mark is reached, you will be required to pay the back-taxes along with interest.
How to apply
- Choose a financial provider that offers these specific plans.
- Ensure the plan complies with the required investment rules for Italian and EU stocks.
- Maintain your investment for a minimum of five years to secure the tax exemption.