The Individual Savings Account Regulations 1998

Qualifying investments for a cash componentU.K.

8.—(1) This regulation specifies the kind of investments (“qualifying investments for a cash component") which may be purchased, made or held under a cash component.

(2) Qualifying investments for a cash component to which paragraph (1) refers are, subject to paragraph (3)—

(a)cash deposited in a deposit account with a building society, or [F1a person falling within section 840A(1)(b) of the Taxes Act] [F2(including for this purpose a credit union)] or a relevant European institution;

(b)cash deposited in a share account with a building society;

F3(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F3(d). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[F4(e)such investment deposits with the National Savings Bank which, according to the terms and conditions subject to which they are made, are expressly permitted to be held under a cash component of an account;

(f)any securities issued under the National Loans Act 1968–

(i)for the purpose of or in connection with raising money under the auspices of the Director of Savings within the meaning of section 11(1)(a) of the National Debt Act 1972, and

(ii)other than national savings certificates, premium savings bonds, national savings stamps and national savings gift tokens,

which, according to the terms and conditions subject to which they are issued and purchased, are expressly permitted to be held under a cash component of an account.]

[F5(g)investments falling within sub-paragraphs [F6(a), F7...] F8... (f) [F9or (g)] of regulation 7(2), in circumstances where the unitsF7... or shares do not satisfy the condition specified in regulation 7(15);

(h)a depositary interest (with the references in that definition to a stocks and shares component and to regulation 7(2)(a) to (h) being replaced with references to a cash component and to regulation 8(2)(a) to (g)).]

[F10(j)a deposit account specified as a stakeholder product by regulation 4 of the Stakeholder Products Regulations;

(k)units in a relevant collective investment scheme specified as a stakeholder product by regulation 5 of the Stakeholder Products Regulations, in circumstances where the units do not satisfy the condition in regulation 7(15);

(l)policies of life insurance, falling within regulation 9, issued in respect of an insurance made on or after 6th April 2005, in circumstances where the policy does not satisfy the condition in regulation 7(15);

(m)policies of life insurance, falling within regulation 9, issued in respect of an insurance made before 6th April 2005, in a case where regulation 4C(3)(c)(i) or (ii) applies.]

[F11(n)arrangements falling within section 47 of the Finance Act 2005 (alternative finance arrangements) under which the person referred to in that section as Y is a financial institution;

(o)arrangements falling within section 49 of that Act.]

(3) A deposit account or share account which is a qualifying investment for a cash component falling within paragraph (2)(a) or (b) respectively must not be connected with any other account falling within the descriptions in those sub-paragraphs, held by the account investor or any other person, and for this purpose such an account is connected with another if—

(a)either was opened with reference to the other, or with a view to enabling the other to be opened on particular terms, or with a view to facilitating the opening of the other on particular terms, and

(b)the terms on which the first-mentioned account in this paragraph was opened would have been significantly less favourable to the holder if the other had not been opened.

Textual Amendments

F4Reg. 8(2)(d)-(f) substituted for reg. 8(2)(d)(e) (6.4.1999) by The Individual Savings Account (Amendment) Regulations 1998 (S.I. 1998/3174), regs. 1, 6

F5Reg. 8(2)(g)(h) added (17.11.2003 with effect in accordance with reg. 1(2) of the amending S.I.) by The Individual Savings Account (Amendment) Regulations 2003 (S.I. 2003/2747), regs. 1(1), 7

F10Reg. 8(2)(j)-(m) added (with effect in accordance with reg. 1(2) of the amending S.I.) by The Individual Savings Account (Amendment No. 2) Regulations 2004 (S.I. 2004/2996), regs. 1(1), 12