Tax-Efficient Investments
ISA’s: Individual Savings Accounts
As one of the most tax-efficient ways to save and invest for your future, an Individual Savings Accounts or ISAs can be a great alternative to traditional savings accounts. When investing within an ISA, there is no further tax to pay on any capital gains, interest or dividends earned on the assets held within your investment, and they do not use any of your capital gains, savings or dividend allowances. Further to this, when you come to draw from your ISA, the amount you draw is completely tax-free, and so you do not have to report any income drawn from your ISA on your annual tax return.
Invest up to £20,000 each tax year
An ISA (Individual Savings Account) is a savings account with added benefits.
ISAs are one of the most tax-efficient ways to invest and save for the future. Your investment within an ISA does not use any of your capital gains, savings or dividend allowances, and you do not have to pay any additional tax on capital gains, interest or dividends generated on the assets held within it.
How much can you invest tax-efficiently?
The annual ISA allowance is currently £20,000 in the 2024/25 tax year.
What is an Investment ISA?
Investment or Stocks & Shares ISAs offer tax-free compound growth year-on-year while Cash ISAs offer limited returns on capital. Investing in stocks and shares through this type of ISA gives you the opportunity to gain a higher return on your investments than investment in a Cash ISA. Although market fluctuations may result in you receiving a lower return than you invested, in the long term, you might earn higher returns.
Want to find out more?
We can help you find the right ISA for your financial goals and risk appetite. If you’d like to find out more about investing in an ISA, contact us today.
The value of an ISA with St. James’s Place will be directly linked to the performance of the funds selected and may fall as well as rise. You may get back less than you invested. An investment in a Stocks and Shares ISA will not provide the same security of capital associated with a Cash ISA.
The favourable tax treatment of ISAs may not be maintained in the future and is subject to changes in legislation.
Please note that Cash ISAs are not available through St. James’s Place.
