HMRC is to allow fractional shares to be held in ISAs, according to reports, reversing its stated position of last year.
Rather than an investor having to buy a whole share, they can now buy part of a share, making it possible for people with less money to invest to own companies with very high share prices which might otherwise be beyond their reach.
The Investing and Saving Alliance immediately came out in support of the move by HMRC.
Lisa Laybourn, policy director at TISA, said: “The announcement by HMRC that they will allow the holding of fractional shares in ISAs is a welcome one, and in particular we are pleased that they have stated there will be no assessment of fractional shares held [by investors] before the changes come into force.
“The proposal has broad industry support, helps savers on lower incomes, and maximises the efficiency of any savings and investments an individual consumer may have.”
She added: “We have consistently recommended addressing the limitations and complexities within the ISA system. Simplification of ISA rules, including allowing for practices allowed in other accounts such as fractional shares, fosters an environment where investing is more accessible and rewarding for all.
“Fractional shares enable consumer access to investment in some of the world’s leading companies, making the ISA system more flexible and advantageous for all savers.
“We look forward to engaging with HMRC further on this issue.”
