- Proposed changes to how open-ended property funds operate could put them in breach of Isa rules
- HMRC is now considering a crackdown - yet another reason investors should seriously consider moving on
Another nail has entered the coffin for open-ended property funds. Having already faced down the decimation of real estate business models in lockdown, mass trading suspensions in 2016 and 2020, and the prospect of stringent new regulations, such funds could now find themselves banned from Individual Savings Accounts (Isas).
HMRC has warned that a recent Financial Conduct Authority (FCA) proposal to set a notice period of between 90 and 180 days on investor withdrawals from such funds would put them in breach of Isa rules. Under current legislation, the vast majority of Isa account holders must be able to access their funds or transfer them to another Isa within 30 days of making an instruction to their account manager.