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Fund Supermarket ISAs /

High Yield Income Fund ISAs

High yield tax-efficient income payment on your investment or savings

If you are an income seeker who is looking for high yields, see below for a selection of funds that offer regular income payment options.

Investment Fund ISAs

Multi Manager High Income

from Hargreaves Lansdown

Income Yield 4.46% pa - Interest Payable Monthly*

Why we like it: The Hargreaves Multi Manager High Income fund aims to deliver a high monthly income to clients by blending different types of funds and moving between different areas of the market when more attractive opportunities emerge. HL also aim to grow this income payment over time and therefore may invest in higher risk smaller companies they believe offer great potential for long term capital growth.

This fund is available via: Hargreaves Lansdown investment platform »

*Historic yield as at 31/12/2020

Important: The value of your investments can rise as well as fall. You may get back less than you invested. If you’re unsure, we recommend you ask for independent advice.

Listed Equity Income

from AVIVA Investors

Income Yield 4.20% pa - Income Paid Bi-annually*

Why we like it: Getting paid a regular income is a priority for many investors. Whether you're in retirement, or want to boost your existing income, an equity income fund could be right for you. Even if you do not need income now, you can opt to reinvest it to boost capital growth. An emphasis on dividends and dividend growth makes this fund a more traditional UK equity income fund, in our view, so it could help form the foundation of an income portfolio.

This fund is available via: Hargreaves Lansdown investment platform »

*Historic yield correct as at 31/10/2020

Important information: Please remember the value of your investment and any income from it may fall as well as rise and is not guaranteed. You may get back less than you invest.

Monthly Distribution

from Artemis

Income Yield 3.70% pa - Interest Payable Monthly*

Why we like it: If you are looking for a high income yield this fund is suitable for long term investors drawing regular income from their portfolios. With a focus on high yield bonds and shares, the fund manager is an experienced bond investor who has a flexible approach to seeking out the best income opportunities.

This fund is available via: Interactive Investor investment platform »

*Historic yield as at 30/9/2020

Important information: Please remember the value of your investment and any income from it may fall as well as rise and is not guaranteed. You may get back less than you invest.

Moneybuilder Income

from Fidelity

Income Yield 2.89% pa - Income Paid Monthly*

Why we like it: A fund with a conservative approach to bond investing. The focus is on quality companies that are in good financial health and generate enough cash to keep paying bondholders. Aims to provide a relatively steady income and a small amount of growth, without taking excessive risks. It could help diversify a portfolio focused on shares, or be used as a way to limit volatility during tougher times for stock and bond markets. 

This fund is available via: Fidelity investment platform »

*Distribution Yield as at 30/11/2020

Important information: Please remember the value of your investment and any income from it may fall as well as rise and is not guaranteed. You may get back less than you invest.

Investment Income Plan ISAs

FTSE Quarterly Contingent Income Plan

from Meteor

Allow ISA Transfers
Annual Income Up to 6.00%
  • Counterparty: BNP Paribas
  • Term: Up to 8 Years

With the current record low interest rate environment, income is high up on the agenda for many investors and so the ability to receive 6.0% per year even if the FTSE falls by up to 15%, is certainly worth a closer look.

Important: Structured investment plans are not capital protected and are not covered by the Financial Services Compensation Scheme (FSCS) for default alone. There is a risk of losing some or all of your initial investment due to the performance of the underlying investment. There is also a risk that the company backing the plan known as the Counterparty may be unable to repay your initial investment and any returns stated.

  • Potential quarterly income: 1.5% (equivalent to 6.0% annually)
  • Income paid even if FTSE 100 falls by 15%
  • Alternative option also available returning up to 5.5% pa if the FTSE doesn't drop by more than 20%
  • Potential to kick out quarterly from year 2 onwards
  • Available for ISA, ISA transfers and direct investments
  • Capital is at risk if the FTSE 100 Index has fallen by more than 35% at maturity from it's initial level, in which case your initial investment will reduce by 1% for each 1% fall
  • Minimum investment £5,000
  • An arrangement fee applies to this plan
  • If you withdraw your money during the plan you may get back less than you originally invested

Important Information: Structured investment plans are not capital protected and are not covered by the Financial Services Compensation Scheme (FSCS) for default alone. There is a risk of losing some or all of your initial investment due to the performance of the underlying investment. There is also a risk that the company backing the plan known as the Counterparty may be unable to repay your initial investment and any returns stated.

What is a High Yield Income Fund ISA?

A high yield income fund ISA is a way of using your ISA allowance with an aim to provide you with a high yield tax-efficient income payment on your investment or savings. Income may be paid on a quarterly, semi-annual or annual basis, so you can choose an option to suit your savings goals.

High yield income fund ISAs offer the potential for higher income than from cash savings although you do need to be comfortable with the associated investment risk. To obtain the higher yield, fund managers will typically invest in lower grade bonds provided by companies where there is a higher risk of default.

You are permitted to invest all or part of your annual tax-free amount in to an investment ISA or in to a cash ISA. Alternately, you can divide your allowance between the two types of ISA as you wish

What Can a High Yield Income Fund Offer?

Investing in a high yield income fund ISA can offer:

Regular income - Many funds offer either monthly or quarterly income options. If you invest in an ISA, income can be distributed to you tax free. If you prefer, some funds allow you to accumulate the income within the fund by buying more units, in order to provide capital growth.

Diversification - a typical corporate bond fund will invest in at least 40 different institutions or more, reducing the risk to investors in the event of default by a bond issuer.

Potential for capital growth - this type of fund can provide capital growth at a lower level of risk than equity investment.

Fund manager expertise - Our Select Fund range of bond funds for income have been assessed by independent research company Morningstar OBSR and all feature at least a Gold or Silver rating.

Why Invest Through our Fund Supermarket?

There are several reasons why our Fund Supermarket might be right for you:

1.Low charges - Many of the funds available to you can be accessed at no initial charge. What's more, many annual management charges offer a discount of up to 0.20% per year.

2.Great choice of funds - Over 1500 funds to choose from including leading UK income fund managers such as Invesco Perpetual, Jupiter and Fidelity.

3.Manage your funds online - Our Fund Supermarket service provides you with online access so you can monitor your investment funds 24/7, wherever you are.

4.Customer Services Team - We are here to help you if you have any queries.

Can I Transfer Existing High Yield Income Fund ISAs into your Fund Supermarket?

Transfers are permitted and are straightforward to complete. Contact a member of staff for more details.

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Important Risk Information:

The value of investments can go down in value as well as up, so you could get back less than you invest. It is therefore important that you understand the risks and commitments. This website aims to provide information to help you make your own informed decisions. It does not provide personal advice based on your circumstances. If you are unsure of how suitable an investment is for you, please seek personal advice.

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15th March 2021

You've decided to invest your savings into a Stocks and Shares ISA. You'll be using your tax-free ISA allowance for this year before the deadline, while also investing your money for your future. But what do you need to consider before opening an account? We've put together a list of our top five considerations for you to think about before you click "apply". 

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