Launched in 1999, ISAs were introduced to encourage people to save for their future. ISA accounts have changed quite a bit over the years, but essentially, they can be used to save money in a tax-efficient way.
Every tax year, which runs from 6 April to 5 April the following year, you are given an ISA allowance that lets you save or invest money up to a certain amount without paying tax on the interest you earn.
The ISA allowance is set by the government and for the 2022/23 tax year the limit is £20,000. This means you have until 5 April 2023 to use up your ISA allowance for this tax year.
If you miss this deadline, any money you pay into an ISA will count towards your 2023/24 ISA allowance.
As with other savings accounts, there are different types of ISAs:
• Cash ISAs (Fixed and Variable)
• Stocks and shares ISAs
• Innovative finance ISAs
• Lifetime ISAs.
At Darlington Building Society we offer Cash ISA’s that are either easy access (which means you can add or withdraw money whenever you want), or fixed rate (where a guaranteed rate is set, and no withdrawals are allowed during the fixed term).
Overall, there is no limit placed on the number of ISAs you can have in total, but the rules state that you are only permitted to invest in one of each different type of ISA up to the ISA limit per tax year.
To explore the range of ISA’s we have available click here.