IMA Records Fall In ISA Sales During 2003/2004 Tax Year

by Jason Gorringe, Tax-News.com, London

28 April 2004

Sales of tax advantaged Individual Savings Accounts, or ISAs, were higher in March 2004 compared to the same month in 2003, although the latest figures from the Investment Management Association have revealed that total sales for the 2003/2004 tax year were down on the previous year.

The IMA’s data shows that net ISA sales stood at £496 million in March, more than double those seen in the previous month and representing 21% growth since the same time last year.

However, total ISA sales for 2003/2004 reached £3.6 billion, representing a decrease on the £4.1 billion bought by investors in the previous year.

The IMA statistics also show that ISA sales were dominated by the UK All Companies sector, which accounted for 34% of gross sales, followed by UK Corporate Bonds with 17%.

Meanwhile, the most popular distributors of ISAs were sales force/tied agents, accounting for 36% of gross ISA sales, closely followed by intermediaries (31%) and sales direct from the public (30%).

Over the previous 12 months, the sales force/tied agent channel accounted for almost half of gross ISA sales (49%) according to the IMA.

Commenting on the results, Richard Saunders, Chief Executive of the IMA observed that: “ISA sales in March were stronger than last year, though still well below their peak in 2000. Investors have been returning to funds since the middle of last year, and to equities over the last six months. That trend is continuing.”

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