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Individual Savings Accounts (ISAs) are varied - they can range from cash that you want to save in the bank, to speculative stock market shares. Whatever your investment type, an ISA may be useful in order to ensure that it exists in a tax-efficient environment.

Speak to an independent financial adviser to find out which type of ISA is best for you.

*The value of your investment can go down as well as up and you may get back less than the amount invested

ISA Limits

For the 2019/20 tax year, the ISA allowance is £20,000. An ISA allowance can be split across a Stocks & Shares ISA and a Cash ISA or invested all in either one. Children are subject to a Junior ISA allowance of £4,368.

Types of ISA

There are different types of ISA account, all with their own unique features:

Cash ISA

Cash ISAs are similar to savings accounts, but the interest is tax-free, meaning that any interest you earn, you keep. Cash ISAs differ depending on your needs: some offer instant access to your money, and others feature fixed rates for those individuals looking to save a lump sum.

Stocks and Shares ISA

A Stocks & Shares ISA allows you to invest in funds, bonds, and shares in individual companies. You do not have to pay Capital Gains Tax on profits made from share price increases. There is no tax on interest earned on bonds, nor on dividend income. There is a fee for the management of your accounts.

Junior ISA

Junior ISAs are designed to build up the savings of an under-18, tax-free. The account can be opened by a parent or guardian on behalf of the child, and both family and friends can contribute. Junior ISAs can operate as either Cash ISAs or Stocks & Shares ISAs. The child cannot withdraw funds from the account until they reach the age of 18.

Help to Buy ISA

A Help to Buy ISA is specifically used to help first-time buyers amass a deposit for a property by providing them with a 25% boost on top of their savings. They are Cash ISAs with a lower allowance of £200 a month, plus a one-off £1,200 lump sum. You cannot save into both a normal Cash ISA and a Help to Buy ISA simultaneously.

Lifetime ISA

For those looking to open an ISA between the ages of 18-39, the Lifetime ISA offers a 25% boost on savings. However, it does limit your activity – you cannot take out any money from this ISA before the age of 60, unless it is for your first home, or you will lose the 25% boost. You can hold this ISA alongside another Cash ISA, or Stocks & Shares ISA, but it will take up part of your £20,000 overall ISA allowance. A maximum of £4,000 a year can be invested.

ISA Transfers

Transferring ISAs – whether from a Stocks & Shares ISA to a Cash ISA, or between providers – is technical, and should not be carried out without professional guidance. It is not advised that you withdraw all the money from your ISA yourself – if you do, you will lose all associated tax benefits.

Your financial advisor will be able to help you transfer your ISA, but they must follow the transfer rules:

  • Current year’s Cash ISA: This can be moved in its entirety to another Cash ISA, or into a Stocks & Shares ISA. It cannot be split between multiple providers.
  • Current year’s Stocks & Shares ISA: This can be moved in its entirety to another Stocks & Shares ISA, or into a Cash ISA. It cannot be split between multiple providers, or more than one Stocks & Shares ISA.
  • Past years’ Cash ISA: These can be moved in their entirety to another Cash ISA or a Stocks & Shares ISA. Or, they can be split between more than one Cash ISA or Stocks & Shares ISA.
  • Past years’ Stocks & Shares ISA: TThese can be moved in their entirety to another Stocks & Shares ISA or a Cash ISA. Or, they can be split between more than one Stocks & Shares ISA or Cash ISA.

We can help by:

  • Collecting the facts necessary to establish a picture of your current financial situation
  • Establishing your ISA-based objectives
  • Identifying the most tax-efficient wrapper for you and constructing a suitable investment/savings plan
  • Presenting you with written financial reports
  • Providing you with ongoing financial support and guidance
  • Evaluating the performance of your ISA(s) annually for optimal gain/preservation

 
*The Financial Conduct Authority does not regulate taxation and trust advice

Registered in England and Wales No 1492223. Registered Office. Paradigm House, Brooke Court, Wilmslow Cheshire. SK9 3ND
Perspective (East Anglia) Ltd is authorised and regulated by the Financial Conduct Authority.
Perspective (East Anglia) Ltd is a subsidiary of Perspective Financial Group Ltd.
Should you have cause to complain, and you are not satisfied with our response to your complaint, you may be able to refer it to the Financial Ombudsman Service, which can be contacted as follows:
The Financial Ombudsman Service Exchange Tower,
London, E14 9SR
Tel: 0800 023 4567 or 0300 123 9 123
www.financial-ombudsman.org.uk

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