Regular Saver ISA

Regular Saving Into A Stocks & Shares ISA

Unlike a cash ISA - which is a straightforward tax-free savings account - a stocks and shares ISA allows you to invest money up to a certain amount without paying tax. This runs from 6^th April each year, check the main page to see the current ISA maximum allowance.

A stocks and shares ISA allows you invest your tax-free allowance while only paying 10% tax on any investment income you make. This can add up to a substantial saving when you consider that, on dividends paid on a non-ISA investment, an additional rate taxpayer would have to part with 42.5% in tax.

You have a variety of options when it comes to using your stocks and shares ISA allowance. You can:

1. Invest your full ISA allowance in a stocks and shares ISA.
2. Regular saver? Make monthly investments into an ISA (up to a maximum of £20,000 pa).
3. Use your stocks and shares ISA allowance for shares - excluding shares traded on the Alternative Investment Market (AIM) - unit trusts, investment trusts, open-ended investment companies (OEICs), life insurance policies, corporate bonds, and gilts.

Are you ready to invest in a stocks and shares ISA?

A stocks and shares ISA, as with all investments, involves an element of risk, so it's important that you're in a sufficiently stable financial position. Before you open a stocks and shares ISA, make sure that:

1. Your debts are under control - you've either paid them off or have affordable arrangements in place to do so.
2. You have emergency savings that you can access easily if something unexpected occurs - if your car breaks down or you're made redundant, you'll need savings that you can use straight away.

If you're very new to saving and don't yet have a basic emergency fund, you may find that a cash ISA is more suitable for you at this stage. Once you've built up some accessible savings in this way, you might then want to consider a stocks and shares ISA, too.