An ISA (Individual Savings Account) is a tax-efficient account. The main perk is that you don't have to pay capital gains tax on any gains made on the investments within it, nor income tax on any dividends or interest received.
There are four different types of ISAs offered to UK taxpayers; a cash ISA, a Lifetime ISA, an innovative finance ISA and a Stocks & Shares ISA.
At TILLIT, we only offer the Stocks & Shares ISA to our customers.
In any given tax year, you can subscribe to multiple ISAs of the same type as long as your total contributions across them do not exceed the annual allowance of £20,000. For example, if you have added £10,000 to a Cash ISA, you can only add up to £10,000 to your Stocks & Shares ISA in the same tax year.Remember, the tax year runs from 6th April - 5th April.
Given the tax benefits associated with ISAs, it is usually a good idea to open a Stocks & Shares ISA before opening a General Investment Account, in order to maximise the tax benefits available to you.
Capital at risk. Tax treatment depends on your individual circumstances and may be subject to change.