What is a Shares ISA?
An Individual Savings Account (ISA) is a kind of financial investment which is made available to residents of the United Kingdom. Designed to encourage personal savings by providing people with the incentive of a more favorable tax status, ISAs are, essentially, savings accounts where the interest earned is not taxed. Generally, there are two kinds of ISAs: the cash ISA and the stock or shares ISA. Each tax year, which runs from April 6 to April 5 (of the following year) in the UK, every individual over the age of 16 is given an “allowance.” This allowance is the maximum amount of money, in cash or stocks, a person is allowed to place into a tax-free ISA each year. A shares ISA is a kind of ISA that primarily holds stocks and shares. There are a variety of rules that govern the investment held in a shares ISA. The stock or shares, for example, in an ISA are tax-free. Cash, on the other hand, that is held in a stock or shares ISA is designated as “cash awaiting investment” and is subjec
