Individual Savings Accounts (ISAs) are a simple way of making tax-free savings. Your savings grow free from Income Tax and Capital Gains Tax. Every year you get an ISA allowance, which is the maximum amount of money you can pay into your account.
You cannot roll over your allowance from one year to the next, so if you don’t use it before 6 April you lose it and will miss out on generous tax relief.
Generous ISA limit – the new ISA limit is £20,000
Great flexibility – you can now split the ISA allowance as you wish between a Cash ISA and Stocks & Shares ISA.
Simple transfer options – you can transfer from a Stocks & Shares ISA to a Cash ISA, and vice versa. Under previous rules you could only transfer from a Cash ISA to a Stocks & Shares ISA.
Improved tax efficiency – you have always been able to hold cash in a Stocks & Shares ISA, but any interest is in effect paid net of basic rate tax. Under the new rules interest on cash held in a Stocks & Shares ISA is completely tax-free.
Junior ISAs – the limit has increased to £4,128.
Will I be able to transfer between cash and investments?
You could already transfer existing cash ISAs into stock and shares ISAs, but not the other way round. From 1 July 2014 you are now able to move money both ways.
IMPORTANT INFORMATION: Remember that the value of investments and the income from them can go down as well as up and that past performance is no guarantee of future returns. Key Feature documents give full details of aims, risks and charges – these should be read before you invest. Whilst we provide product information, guidance and fund research, we cannot know which of these products or funds, if any, are suitable for your particular requirements and must leave that judgement to you. Tax treatment depends on your individual circumstances and may be subject to change in the future. If you are unsure about the suitability of an investment, you should seek expert financial advice. Read more