Easy Access ISA
The Individual Savings Account is becoming the first port of call for tax free saving in the UK. Available to UK savers, the ISA is an account where no tax is charged on the interest. That means that any money accrued over the period of saving or investment, is not tax deductible.
There are a number of account types under the ISA, one of which is the Easy Access ISA. An easy access ISA is one that does as it literally denotes. The account holder is allowed a lot of leeway in accessing the account. The easier access to the account means that the individual can withdraw money without restrictions in duration. In most instances, the withdrawals do not have a penalty fee regardless of amount and times withdrawn. This is however dependent on the bank that you are registered with. Similarly, you get the ease of depositing money into the account. A typical ISA allows for a certain standard limit on the total amount that can be deposited into the account on an annual basis. With an easy access ISA, you get to deposit as much money as you wish into the account without restrictions.
Easy Access ISA Restrictions
Though the account allows for easier access to funds transfer, there will be often certain restrictions put in place by the ISA provider. These might include:
- The amount of money that can be withdrawn is only limited to that which is within a tax year and cannot be from the previous year.
- The amount of money that can be deposited; though with greater fluctuation in terms of period and amount per installment, should not exceed the limit. The limit is £20,000 for the 2022/23 tax year.
- The money that can be withdrawn is limited - this may be stipulated by the bank.
An easy access ISA is a great account option for an individual who requires flexibility in withdrawal and deposit of money within the account. However, since there are often fixed or predetermined rates of withdrawal, one should always check with the bank before signing up for the account. Individual banks and credit institutions have different restrictions so it is best that you do your research before getting the account. It is also best to familiarize oneself with other ISA account types so as to explore all options.