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One of my major concerns when I moved to the UK was the tax. I had heard horrible stories so much that It scared me to Save and Invest my Money.
Stocks and shares ISA is one of my Favorite ways to invest my money Tax Free. It is an Investment account that is designed to help you make the most of your money.
Now let’s get down to the Basics:
What is ISA: ISA is a savings account where you can save and invest your money.
There are four main types of ISAs:
- lifetime ISAs
- 2. Cash ISAs
- 3. Stocks and Shares ISAs
- 4. Innovative Finance ISAs
- There is also a Junior ISA which allows you invest on behalf of your child until they turn 18
Reasons to invest in an ISA?
- ISAs allow you to protect your money from income and capital gains tax.
- 2. You get up to £1,000 free from the Government.
- 3. You can split your investments across all four ISAs as long as you do not exceed the annual ISA limit of £20,000
Each tax year (6 April to 5 April) there’s a maximum amount of money you can put in ISAs, called the ISA allowance.
In the 2023/2024 tax year the allowance is £20,000. So if you put £10,000 in an ISA in the 2023/2024 tax year, you could still put up to £20,000 in the following tax year.
You can only put a maximum of £4,000 into a Lifetime ISA each year.
~ A Lifetime ISA boosts your house deposit savings with a 25% government bonus on top of your contributions.
~ A Stocks & Shares ISA is a great way to grow your money for the long-term by investing in the stock market. I use trading 212 for my stocks and shares ISA because it’s commission free with no fees.. here’s the link to register and get started
~ And most importantly every income gained from investing such as capital gains and dividends are absolutely TAX FREE.
~ My favourite ISAs to invest in are the Innovative Finance ISAs and the Stocks and Shares ISAs.
You can open a ISA investment account with your bank or any financial institution of your choice.