In this brief blog, we are going to provide a brief guide and answer the question “ what does ISA stand for “. This will help you understand this savings product.

What does ISA stand for?

ISA stands for Individual savings account.

ISA definition

ISA stands for individual savings account its is a form of investment in the UK which is tax-free and has a maximum cap which you can invest. This is known as your annual ISA allowance. No tax is paid on any returns you make from your ISA.

The ISA limit may be changed each year by HM treasury. You should check for your annual ISA allowance.

Types of ISAs

There are two types of ISAs available in the UK

They are

stocks and shares ISAs

cash ISAs. 

Stocks and shares ISAs

Stock and shares ISAs allow you to invest in any stock and shares funds. This could be bonds, unit trusts, cash, REITS etc. You will not pay any tax on any returns made from your stocks and shares ISA.

Cash ISAs

Cash ISAs are just like typical savings accounts except that any returns you make on them are tax free.

You can use your annual ISA allowance on both a cash ISA and a stocks and shares ISA or both.

You can learn more about ISAs here.

If you have any questions or comments please let us know.

John Bate

John has 22 years of experience in financial services. This spans across financial research, financial services (As a qualified mortgage broker and underwriter), financial trading and sales at global investment banks. While working as a publishing research analyst, he covered European bank credit and advised institutional clients on investment strategies at both JP Morgan and Societe Generale. John has passed all three levels of the CFA (Chartered Financial Analyst) programme.