ISAs - Who can invest and how much?

For an investor to be eligible to take full advantage of an ISA, he or she must be an individual – that is, not a company or a trustee – aged 18 years or more; 16 and 17-year-olds can invest in a Cash ISA, up to £5,340.

You must be ordinarily resident in the UK, except for Crown servants serving overseas and their accompanying spouses.

If an individual ceases to be eligible to invest in an ISA, any existing accounts will continue to be exempt from UK tax but no future regular or single contributions may be made. Husbands and wives are treated as individuals and each may fully subscribe to an ISA in their own names.

As mentioned in the section on tax the current annual ISA allowance is £10,680. The entire amount can be invested in a Stocks and Shares ISA with one provider in a single tax year. Alternatively up to £5,340 of the allowance can be invested in a Cash ISA with one provider while the rest can be invested in a Stocks and Shares ISA.

These, however, are just the maximum amounts. You can mix and match any way you wish as long as the Cash ISA element does not top £5,340 and the total stays within the £10,680 limit.

 

This ‘How to’ guide is produced by Shares Magazine and is only for general information and use, and is not intended to address particular requirements.

The value of investments and the income derived from them can go down as well as up. Past performance is not necessarily a guide to future performance.

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