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Title Bar

Brochure Title

Your guide to the latest ISA rules

Whats new for ISAs What happens in April 2008

The different ISAs explained

Your ISA questions answered

Financialinsights

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Contents pageIntroduction 2

The new ISA rules 3

Stocks & Shares ISAs 5

Cash ISAs 7

Your questions answered 8

ISA rules at a glance 10

JPMorgan Asset ManagementJPMorgan Asset Management is one of the worlds largest asset managers, with offices and clients in

more than 40 countries.

Worldwide, we manage assets of more than 571 billion* on behalf of individuals and institutions ranging

from pension funds to governments. We look to offer investment expertise covering all world markets

and key asset classes, including shares, bonds, property and commodities.

From OEICs to investment trusts, ISAs to pension plans, we are committed to delivering the most

appropriate solution to meet your financial goals.

*Source: JPMorgan as at 30 September 2007

ISA Guide Introduction1

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ISA Guide Introduction 2

A new ISA age is coming

Individual Savings Accounts(ISAs) are one of the mostpopular ways to save and

invest tax-efficiently

To date, more than 100 million ISAs have been opened, holding assets

worth more than 207 billion.

1

From 6 April 2008, ISAs will become even more attractive. New rules

will make them simpler and more flexible and investors will enjoy

a slightly larger ISA allowance too.

All you need to know

This brief guide aims to tell you everything you need to know about

the new ISA rules. It also gives a recap on the two types of ISA and

answers some common ISA questions.

You can also use the reply card at the back of this guide to learnabout the range of ISAs from JPMorgan Asset Management.

We hope this guide is useful and helps you make the most of your

new ISA opportunities.

1Source: HM Revenue & Customs, Oct 2007; number of ISAs opened counts

mini and maxi ISAs individually.

From 6 April 2008, ISAs will

be simpler and more flexible

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ISA Guide The new ISA rules3

ISAs bigger, better, simpler

Get ready for some excitingchanges to ISAs

The ISA advantage

ISAs are one of the easiest ways to save and invest tax-efficiently.

Quite simply, ISAs act as a tax-efficient wrapper around your

investments, sheltering them from income tax and capital gains tax.1

ISAs can hold a wide range of investments including investment

funds, cash deposits, shares and bonds.

You do not need to mention ISAs on your tax return. Plus, ISAs have

no fixed term so you can access your capital at any time, subject to

your chosen ISA providers terms.2

New ISA rulesNow, new rules introduced in April 2008 are set to make ISAs even

more user-friendly.

Here are the key changes:

1. Higher allowance

From 6 April 2008, the amount you can invest in an ISA will rise from

7,000 to 7,200 a year, (600 a month). Each individual has their

own allowance, so couples will be able invest up to 14,400 per tax

year (1,200 per month).

The amount of ISA allowance that can be put in a Cash ISA will rise

from 3,000 to 3,600.

2. Investment flexibility

You will have a lot more flexibility in how you allocate your ISA

allowance. You can invest the whole 7,200 in a Stocks & SharesISA. Alternatively you can split the allowance between a Stocks

& Shares ISA and a Cash ISA. This can be in any proportion you

wish just so long as your Cash ISA doesnt exceed 3,600.

See diagram opposite.

1Please note that the basic-rate tax credit on share dividends can no longer be reclaimed by ISAs. The tax treatment of ISAs is subject to change in the future.2Some ISA providers may impose their own fixed term or require notice of withdrawal; Stocks & Shares ISAs should always be viewed as a medium to long-term commitment.

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ISA Guide The new ISA rules 4

The ISA rules

You must be 18 or over to open a Stocks & Shares ISA,or 16 for a cash ISA

You must be a UK resident

Your ISA allowance must be used within the tax year you

cannot carry over unused allowance to the next tax year

3. Transfers from Cash ISAs to Stocks & Shares ISAs

From 6 April 2008, it will be possible to transfer some or all money

saved in Cash ISAs in previous tax years to Stocks & Shares ISAs.

Such transfers can be of any size and will not affect your current

ISA allowance.

This means you can easily increase how much ISA capital you

have in stock market investments. But note that you cannot

transfer the money back to a Cash ISA if you change your mind.

4. PEPs become ISAs

Finally, Personal Equity Plans (PEPs) were the tax-free forerunner

to ISAs. From April 2008, all PEPs will become Stocks & SharesISAs and subject to exactly the same rules and tax breaks.

Three ways to use your ISA allowance

Applies from 6 April 2008

Stocks &

Shares ISA

7,200

You can invest anyamount up to yourwhole 7,200 ISA

allowance in aStocks & Shares ISA

Stocks &

Shares ISA

3,600

Cash ISA*

3,600

or you can splityour ISA allowance

equally betweena Cash ISA and aStocks & Shares ISA

Stocks & Shares

ISA

More than

3,600

Cash ISA*

Less than 3,600

or you can put less than3,600 in a Cash ISA

and invest more in aStocks & Shares ISA tobring the total to 7,200

1 2 3

7,200

*Cash ISA maximum is 3,600

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ISA Guide Investment choice5

Stocks & Shares ISAs

Tap into world stock markets

A Stocks & Shares ISA allows you to share in the growth and income

potential of shares, bonds and other assets.

Please remember that stock market investments can be volatile and

you can lose capital if prices fall. Please talk to your financial adviser to

ensure that a Stocks & Shares ISA is suitable for your circumstances.1

Direct or pooled

You can invest individual shares and securities in your ISA. Or you can

invest in pooled investment funds such as OEICs or investment trusts

offered by fund managers.

Pooled funds indirectly give you exposure to dozens if not hundreds

of different shares and other investments.

You also get the benefit of professional investment management, with

expert fund managers managing the fund's investment portfolio on

your behalf.

Latest performance and prices for OEICs and investment trusts aregiven in the national press and online so you can easily track the progress

of your investments.

1Please remember that Stocks & Shares ISAs will usually have a medium to high-risk profile whereas Cash ISAs are generally low risk.

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ISA Guide Investment choice 6

Stocks & Shares ISAs at JPMorgan Asset Management

We offer two types of investment fund in an ISA:

OEICs we offer 31 OEIC funds covering all key stock markets and

different investments. Choose from funds aiming for income, growth

or a blend of both. OEICs are simple to monitor as their share price

always tracks their underlying portfolio.

Investment Trusts select from 19 investment trusts, covering key

regions, countries and sectors including developed and emerging

markets. Investment trusts are structured as limited companies and can

be a flexible, low-cost way to invest. Their share price will depend on

market demand and will not track their underlying investments directly.

Complete and return the reply card in this guide to learn more about

ISA options from JPMorgan Asset Management.

2Conditions and restrict ions apply please speak to your Financial Adviser or ISA provider

What can go in a Stocks & Shares ISA Shares listed on any recognised stock exchange

Corporate bonds listed on any recognised stock exchange

Gilts and overseas government bonds

OEICs and unit trusts

Investment trusts

EU offshore funds2

Employee share scheme shares2

Life insurance-based investment plans2

Stakeholder medium-term products

Investment limit from

April 2008: 7,200 a year

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ISA Guide Investment choice7

Cash ISAs tax-efficient

saving for low-risk investorsCash ISAs act like savingsdeposits that allow you to

earn interest tax-efficiently

Bigger allowance

From April 2008, youll be able to invest up to 3,600 in a Cash ISA.

Previously the limit was 3,000.

If you want to put less than 3,600 in cash, the remainder can go in

a Stocks & Shares ISA, up to the overall 7,200 ISA limit.

Fixed or variable rates

Cash ISAs may offer fixed or variable rates of interest. Some may offer

bonuses if you stay invested for a specified length of time check with

providers for terms.

Tax-free interest

Interest can be rolled up in the ISA or paid out to you.

Interest from a Cash ISA does not need to be declared on your annual

tax return, and is paid out without tax deducted.

Child Trust Funds and ISAs

The government has indicated that it may be possible in the future for

the tax-free proceeds of Child Trust Funds (CTFs) to be rolled into ISAs

when a child reaches 18. Such proposals are still at an early stage

given that the first CTFs do not mature until 2020.

What can go in a Cash ISA

Bank and building society accounts

Money market funds (also known as cash funds

or liquidity funds)

National Savings & Investments ISA products Some capital guaranteed life insurance-based plans

Stakeholder cash products

Cash limit from April 2008:

up to 3,600 a year

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ISA Guide Q&A 8

Your questions answered

Investor queries about ISAsand the new rule changes

Can I still take out ISAs with different providers in the same tax year?

Yes. If you want to take out both a Cash ISA and a Stocks & Shares

ISA, each can be arranged with a different provider.

Will I be able to put more than 3,600 in a Cash ISA if I dont open

a Stocks & Shares ISA?

No the absolute limit for Cash ISAs will be 3,600pa from April 2008,

whether or not you choose to invest in a Stocks & Shares ISA as well.

Can I hold ISAs jointly with my spouse?

No ISAs can be held in one name only. Husbands and wives each

have their own ISA allowance so using both allowances will allow you

to put up to 14,400 in ISAs annually.

Can I open an ISA for a child?

You have to be 18 to open a Stocks & Shares ISA. However, Cash

ISAs can be opened from age 16.

Can I invest monthly amounts in an ISA?

Yes many ISA providers accept monthly savings. The maximum

monthly amount is 600 (300 for a cash ISA). The minimum monthly

amount accepted by JPMorgan Asset Management is 100 a month.

Is there any limit on the value of PEPs that can become ISAs?

No the total value of your existing PEPs will become ISAs on 6 April

2008. Your PEP provider(s) will be able to give you more information.

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ISA Guide Q&A9

Your questions answered

Whats the minimum I can invest in an ISA?

It depends on the ISA provider you choose. At JPMorgan Asset

Management, we accept lump sum investments starting at 3,000

for OEICs and 1,000 for Investment Trusts. Our monthly ISA

minimum is 100.

Is it possible to transfer from a Stocks & Shares ISA to a Cash ISA?

No the new rules only allow capital to be transferred from a Cash ISA

to a Stocks & Shares ISA, not vice versa.

Can capital losses from an ISA be set against taxable gains

elsewhere in my investment port folio?

No. You can only set losses against gains on taxable investments

to reduce a capital gains tax liability.

Can I pass on ISAs to my children when I die?

You can pass on investments and savings held in your ISAs but not the

ISA itself. ISAs do not shelter you from inheritance tax, so their value

will be added to your estate for tax purposes.

What will happen to ISAs if the government changes?

ISA rules and tax breaks are always open to change by governments.

However, the current government has said ISAs will be available

indefinitely, having previously only guaranteed them to 2010.

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ISA Guide RECAP 10

ISAs at a glance

From 6 April 2008, the ISA rules are as follows: You can invest 7,200 per tax year (6 April-5 April)

There are two types of ISA: Stocks & Shares ISAs and Cash ISAs

Each type of ISA can be opened with the same or different providers

You can put all your allowance (7,200) in a Stocks & Shares

ISA or put up to 3,600 in a Cash ISA

If you put less than 3,600 in a Cash ISA, the remainder can go into

a Stocks & Shares ISA

You can switch ISAs from one provider to another by making a formal

ISA transfer

Capital from cash ISAs can be transferred to a Stocks & Shares ISA

ISAs do not need to be declared on your tax return and can shelter

you from income tax and capital gains tax1

ISAs are one of the easiest ways to save and invest tax-efficiently.

Be sure to make the most of yours

For more information contanct your usual JPMorgan AssetManagement representative or call the dedicated brokerline

0800 727 770www.jpmorganassetmanagement.co.uk

1Please remember that the tax treatment of ISAs could change in the future.

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JPMorgan Asset Management

www.jpmorganassetmanagement.co.uk

or call 0800 727 770

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