What can you put into a cash ISA?
Before you commit to a cash ISA, check that there aren't any restrictions operating on your intended source of cash. The current HMRC rules on what can be included within a cash ISA are as follows:
- Cash deposited in bank or building society accounts - this includes structured deposit plans.
- National Savings and Investments products that are specially designed for ISAs - these may vary, so it's sensible to check with NS&I before you take any action.
- Alternative finance arrangements, such as Sharia-compliant finance products.
- Shares in companies and collective investment schemes that fail to meet the qualifying conditions for stocks and shares ISAs - if they do meet these conditions, you are free to use them as part of your stocks and shares ISA allowance instead.
- Life insurance policies that fail to meet the qualifying conditions for the stocks and shares ISAs - again, if they do meet these conditions, you are free to use them as part of your stocks and shares ISA allowance.
- Stakeholder cash products.
- Stakeholder medium-term products that fail to meet the qualifying conditions for stocks and shares ISAs - those that meet the required conditions can be used as part of your stocks and shares ISA allowance.
Who is entitled to open a cash ISA?
To be eligible for a cash ISA:
- You must be aged 16 or over - for stocks and shares ISAs, this age limit rises to 18.
- You must be a resident or ordinarily resident in the UK. In certain circumstances exceptions may apply - for example, if you are a Crown employee working overseas - so check with your intended cash ISA provider.
- You must not hold more than one cash ISA in a single tax year, which runs from 6th April in one year to 5th April the next year. However, you are permitted to transfer from one cash ISA provider to another.
- You must be the sole owner of the ISA - there's no option for joint ownership with a cash ISA because every individual has their own personal ISA allowance.