ISAs
Up to £7,000 can be invested in an ISA this year.
Investors may choose to invest up to the limit with a single plan manager who can provide both elements - a maxi ISA - or to invest with separate managers, each handling separate elements - mini ISAs.
Those investing in a maxi ISA have the option to invest the full £7,000 in stocks and shares, or up to £3,000 in cash and deposits, with the balance up to the maximum in stocks and shares.
For those choosing mini ISAs, the limit for each element is:
£4,000 to be invested in stocks and shares
£3,000 to be held in cash and deposits
16 and 17-year olds can invest up to £3,000, either in a cash mini ISA or the cash element of a maxi ISA.
Although most income accruing in an ISA does so tax-free, the tax credit on UK dividend income cannot be recovered. All investments held in ISAs are free of CGT. There is no minimum investment period for funds invested in ISAs - withdrawals can be made at any time without loss of tax relief. However, some plan managers offer incentives, such as better rates of interest, in return for a commitment to restrictions such as a 90-day notice period for withdrawals.
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