A stocks & shares ISA, otherwise known as an equity ISA, is a way to invest in a wide range of funds on the stock market while retaining the tax-efficient element of a traditional cash ISA, with the money held in such an account being exempt from income and capital gains tax.
This means there is the potential for better returns than can be achieved through a bank or building society savings account. But there are also more risks involved, as the returns generated from a stocks & shares ISA are not guaranteed, and investors risk losing some or all of their initial investment.
You can now also invest in stocks & shares via the Lifetime ISA that launched in April 2017. The Lifetime ISA can be used to save for a first home or for your retirement, and includes a Government incentive. Read more about the Lifetime ISA here.
Up to £20,000 can be invested in a stocks & shares ISA in the 2017/18 tax year.
Read our guide to find out more about stocks & shares ISAs
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Disclaimer: This information is intended solely to provide guidance and is not financial advice. Moneyfacts will not be liable for any loss arising from your use or reliance on this information. If you are in any doubt, Moneyfacts recommends you obtain independent financial advice.
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