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Tax Efficient Savings (ISAs)

Since being introduced in 1999, Individual Savings Accounts (ISAs) have proved one of the most popular and tax-efficient ways to save and invest for the future. Each tax year, you get an ISA allowance which sets the maximum that can be saved within the tax-free wrapper from April to April.

The old ISA system used to limit how much you could put into each pot – you’d either get half your allowance in cash and half in shares, or you could choose to put it all in shares.

But since July 2015, the rules were almost completely relaxed. Although you still have a limit to the amount you can save – £20,000 from 6 April 2017 – you now get to choose how you split this between stocks & shares, cash ISAs and as of April 2016, the new innovative finance ISAs (for tax-free peer-to-peer savings, though most P2P platforms are still waiting for full FCA approval).

You even get to choose whether you want to split it – if not, you can use the whole amount for stocks & shares, the whole amount for cash or the whole amount in an innovative finance ISA. Any savings or investments which stay within the tax-free ISA wrapper will continue to earn interest and reap the tax benefits until you withdraw the money.



The value of an investment will be directly linked to the performance of the funds selected and may fall as well as rise. You may get back less than the amount invested.