What is a Stocks and Shares ISA?
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In short: An ISA that holds investments rather than cash. All capital gains and dividends inside it are tax-free; the £20,000 annual allowance still applies.
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Reviewed by Kaiser Khan
A Stocks & Shares ISA is an investment account where any gains and any dividends are free from UK Income Tax and Capital Gains Tax. You can hold funds, individual shares, ETFs and investment trusts inside one.
The annual ISA allowance of £20,000 covers all ISA types combined. If you pay into a Cash ISA in the same year, the limit is split between them.
Investments can fall as well as rise, so a Stocks & Shares ISA is generally suited to money you can leave invested for at least five years.
Primary source: gov.uk/individual-savings-accounts
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