The Main Changes in the 2024-25 CII R02 Study Text

Here, we take a look at the main changes that you’ll come across in the 2024/25 version of the CII’s R02 study text. As there have been no significant syllabus changes, the majority of the amends stem from the Autumn Statement 2023, the Spring Budget 2024, and the turning of the tax year. This article is particularly relevant to the R02, R06, AF4, and AF5 exams.

This article is correct as at 20 August 2024 and is relevant to the 2024/25 examinable tax year.

R02, Chapter 1

Cash ISAs

Since 6 April 2024, savers can open and pay into multiple cash ISAs (compared to just one per tax year in previous tax years).

The minimum age for a Cash ISA has been raised to 18 (from 16).

Before April 2024, 16- and 17-year-olds could subscribe to a cash ISA. Starting from April 6, 2024, no one aged 17 or younger can subscribe to more than one cash ISA. Transitional arrangements, ending on April 5, 2026, include:

• If a 16- or 17-year-old does not have a cash ISA as of April 5, 2024, they can apply for and subscribe to one cash ISA per tax year until they turn 18.
• If a 16- or 17-year-old already has a cash ISA, they can continue to subscribe to it or transfer it to another cash ISA after April 6, 2024.
• ISA managers have discretion to offer cash ISAs to individuals under these transitional arrangements.

British Savings Bonds

NS&I Guaranteed Growth and Guaranteed Income Bonds are on sale once more in the form of British Savings Bonds. You can invest from £500 to £1 million in each Issue. Interest is taxable, with the interest rate fixed and guaranteed for the selected term (1 or 3 years). There is no access to the money during the term.

R02, Chapter 2

Dividend Allowance

The dividend allowance has halved to £500 from 6 April 2024.

Capital Gains Tax (CGT)

There is a reduction in the higher rate of CGT for non-exempt residential properties; from 28% to 24%. There is no change to the 18% basic rate. 

FSMA 2000 (Financial Promotion) (Amendment) Order 2023

Qualifying cryptoassets are now within scope of the FCA’s financial promotions rules. Such promotions must be fair, clear, and not misleading.

R02, Chapter 7

Non-Mass-Market Investments (NMMIs)

Unregulated collective investment schemes (UCIS) are a type of non-mainstream pooled investment (NMPI). The FCA now classifies NMPIs as non-mass-market investments (NMMIs). Mass-marketing of NMPIs to retail investors is prohibited. These investments can only be marketed to investors who are deemed capable of understanding the associated risks, including:

• certified high-net-worth individuals;
• certified sophisticated investors; and
• self-certified sophisticated investors.

Trusts

Trusts with income of £500 or less will have no reporting requirement and will pay no tax.

For discretionary trusts, where the income is greater than £500, trust rates will apply to ALL of the income (i.e. 39.35% for dividend income, 45% for all other income); and

Where a settlor has created more than one discretionary trust, the £500 is divided by the number of existing trusts, subject to a £100 minimum floor.

Capital Gains Tax (CGT)

The CGT annual exempt amount (individuals and legal personal representatives (LPRs)) has halved to £3,000.

R02, Chapter 8

Trusts

Removal of reference to the £1,000 standard rate band which no longer applies (discretionary trusts).

Married Couple’s Allowance

The floor for 2024/25 is increased to £4,280.

Child Benefit

The income threshold has risen from £50,000 to £60,000.

Multiple ISAs

Since 6 April 2024, savers can open and pay into multiple ISAs (compared to just one per tax year in previous tax years). This rules does not apply to Lifetime ISAs.

UK ISA (British ISA)

This new ISA (once live) will offer an additional £5,000 allowance on top of the current ISA allowance, providing a new tax-free investment opportunity in the UK.

Innovative Finance ISAs

Long-term asset funds, open-ended property funds with extended notice periods and cash have been added to the list of qualifying investments in an innovative finance ISA.

ISA Transfers

Partial transfers are now permitted for current year subscriptions. Previously, the whole amount of any current year subscriptions had to be transferred.

Grab the resources you need!

If you’re studying for your CII R02 exam, and you nervous at the thought of exam day, grab our free taster to try out one of Brand Financial Training’s resources for yourself.  Click the link to download the R02 mock paper taster now!

Alternatively, you can download a taster for AF4, AF5 or R06 if one of those exams is on your horizon.