The HMRC has reversed its decision to force advisers to contact it about kick-out structured products held in ISAs until it completes a review on the issue.
In today's ISA Bulletin 20, the authority says following representations, it is conducting a review into whether kick-out structured products qualify for ISA investment.
"We have received a number of representations about our interpretation of the rule that qualifying securities must not be issued on terms that require the loan to be repaid or the security to be re-purchased or redeemed within the period of five years from the date of purchase," HMRC says.
"While we are considering these representations ISA managers need take no further action to identify any holdings of ‘kick-out' plans. We will provide an update when we have concluded our review."
Earlier this month, HMRC caused a furore when it warned kick-out products might not satisfy the criteria to be an ISA qualifying investment.
At the time it said all ISA managers offering stocks and share ISAs with kick-out plans should contact the CAR Audit to discuss the matter.
Since then, structured product providers have been asking HMRC for clarification.
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