Stocks and Shares ISAs / Investment ISAs

Often referred to as Investment ISAs, Stocks & Shares ISAs can offer a tax-efficient investment opportunity for your ISA allowance.

If you're looking for a tax-efficient savings vehicle and are comfortable with an element of risk, a stocks & shares ISA could be for you. It's essentially a tax-efficient wrapper for your savings, but rather than keeping it in cash, your money is invested in the stock market.

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Stocks and Shares ISAs

AJ Bell Youinvest Investment ISA
Account Type: Investment ISA
Min. Investment: £500 or £25/month
Funds available: 4,000 funds

Further information... Deal online from just £1.50 and never pay more than £9.95 per online deal

Nutmeg Stocks and Shares ISA
Account Type: Investment ISA
Min. Investment: £500
Funds available: 10 managed and 5 fixed allocation portfolios

Further information...
Get an intelligent stocks & shares ISA portfolio. Choose a portfolio that's fully managed by our expert team, or one designed to remain steady and re-balance automatically. No tie-ins, no set-up fees, no exit charges. Easy, online set up in minutes. Start with as little as £500 (plus £100 per month for ISAs below £5,000). Simple fee structures - 0.25% to 0.75% depending on how much you invest, incl VAT. Plus live chat, amazing customer support and brilliant investor tools and guides. Regulated by the FCA and protected by the FSCS. Capital at risk.

One Family Junior ISA
Account Type: Junior ISA
Min. Investment: £10 per month
Funds available: 2 funds

Further information...
The OneFamily Junior ISA helps you to invest for your child's future. It could help towards going to uni, driving lessons or perhaps helping to pay for a flat of their own. It's designed to be a long term children's investment. You invest for your child's future, and only the child can take the money out and only once they're 18. Because it invests in stocks and shares, the Junior ISAs value can fall as well as rise, so your child could get back less than has been paid in. Open your child's Junior ISA online and set up a Direct Debit and as a thank you OneFamily will send you up to £50 in e-vouchers (gift terms and conditions apply - please see OneFamily website).

AXA Self Investor Stocks & Shares ISA
Account Type: Investment ISA
Min. Investment: £500 or £50/month
Funds available: 1,250 funds
Further information...

Award winning - we help you take control of your investments.
Low cost investing charge of 0.35% p.a. if you invest up to £250kand reducing to 0.20% p.a. if you invest £250k or more. Fund manager charges will also apply. Take advantage of our useful tools and videos as well as our UK-based Customer Support Team. Choose from over 1,250 funds or our All-in-One funds managed to different risk levels. The value of a Stocks and Shares ISA can go down as well as up and you could get back less than you invest.

Barclays Stocks & Shares ISA
Account Type: Investment ISA
Min. Investment: £50 or £50/month
Funds available: Over 2000

Further information...
Barclays Stockbrokers has been voted 'Self Select ISA Provider of the Year 2016' by ADVFN. Use our investment research, market insight and tools to help you take control of your investments and choose what's right for you - with access to over 2,000 funds, ETFs, bonds, gilts & more. Now with ISA flexibility, withdraw and replace cash from a flexible ISA during the same tax year without it counting towards your annual ISA allowance.

Remember, the value of your investments can go down as well as up and you may get less than you invest. Tax rules may change in the future and whether particular tax rules benefit you, will depend on your individual circumstances.

MoneyFarm Stocks and Shares ISA
Account Type: Investment ISA
Min. Investment: £1
Funds available: 12 portfolios

Further information...
MoneyFarm Stocks and Shares ISA offers a personalised, hassle-free, tax-free investment solution. MoneyFarm crafts a tailor made portfolio suited to your profile and fully manages it on your behalf, so you don't have to. There is no minimum investment and fee goes from 0% to 0.6% with no extra costs, plus the first £10.000 are always managed free of charge. Regulated by the FCA and protected by the FSCS. Your capital is at risk.

£20,000 managed free of charge for 1 year with code MFACT20K.

Alliance Trust Savings Stocks & Shares ISA
Account Type: Stocks & Shares ISA
Min. Investment: £50
Funds available: Over 2,000

Further information...
We offer a choice of over 4,000 investments. You can save regularly in our ISA from £50 a month and stop, start and change your payments whenever you like. 24/7 access to manage your ISA online. Account fees that don't grow with your investment with our low monthly account charge of £7.50.

Sunlife Stocks & Shares ISA
Account Type: Investment ISA
Min. Investment: £100 or £10/month
Funds available: 1 fund

Further information...
This With-Profits Fund makes investing easy. Choose to invest over the medium to long term from just £10 a month or £100 lump sum. Enjoy complete flexibility and control. You'll have 24/7 online access, and the option to stop, start, increase or decrease your payments - with no penalties. There's also a money-back guarantee on set dates, provided you've not made any withdrawals plus M&S vouchers to thank you for investing. Capital at risk. Provided by Scottish Friendly.

Halifax Investment ISA
Account Type: Investment ISA
Min. Investment: £2,000 or £100/month
Funds available: 3 funds

Further information...
Our Investment ISA is a Stocks & Shares ISA, and has the potential to provide better returns than a savings account. We have three Managed Funds to choose from which invest in a wide variety of non-cash assets on your behalf. Our Investment ISA is a tax-efficient way to make your savings work harder. Capital at risk. Apply now!

Fidelity Stocks & Shares ISA
Account Type: Investment ISA
Min. Investment: £1,000 or £50/month
Funds available: 2,000 funds

Further information...
A tax-efficient way to help you save for the future. Our Stocks & Shares ISA gives you the flexibility to hold cash as well as investments - so you can hold your money in cash if you are concerned about the market's prospects, and move into investments when you believe they have more potential. Invest up to £15,240 in the 2015/16 tax year. Capital at risk. ISA eligibility applies. All tax rules may change. Fidelity Personal Investing does not give advice.

TD Direct Investing Stocks & Shares ISA
Account Type: Investment ISA
Min. Investment: £100 or £25/month
Funds available: 2000 funds

Further information...
Our stocks and shares ISA gives you access to a wide range of investments and tools to help you confidently choose where to invest your ISA allowance. Choose from a Recommended List of over 50 funds selected by experts or if you don't want to spend time researching, you could choose from our Quick Start range of six funds. Take advantage of our £5.95 online share dealing rate in your first three months and pay £0 admin fee if you invest £5,100 or more in your ISA. Investments may go down as well as up and you may not get back all the money you invest. TD provides opinions on whether to buy a specific investment, none of these are personal recommendations.

Standard Life Savings Stocks & Shares ISA
Account Type: Investment ISA
Min. Investment: £500 or £50/month
Funds available: 5 funds

Further information...
Complete the application process in a matter of minutes and manage your investments easily online. Upon signing up, you'll also get a Stocks and Shares ISA cash account so you can hold some or all of your £15,240 in cash. Bear in mind that, as with any investment, your capital is at risk and your investment value can go down as well as up.

Hargreaves Stocks and Shares ISA
Account Type: Investment ISA
Min. Investment: £100 or £25/month
Funds available: 2,500 funds

Further information...
The Hargreaves Stocks and Shares ISA has no dealing charges for funds, plus a low cost reinvestment service. There are super low annual charges on a range of leading funds, exclusive low charges on leading tracker funds and low annual account charge for funds of just 0.45%. 94% of our clients rate our service as good, very good or excellent. (Survey in September, 2014 9,371 respondents)

Scottish Friendly My MoneyBuilder (ISA)
Account Type: Investment ISA
Min. Investment: £10/month

Further information...
Put a little money aside for you. Start from £10 a month. Get £50 cashback when you pay in at least £50. Capital at risk. £50 exit fee applies within the first 5 years.

Scottish Friendly My UK Tracker Options (ISA)
Account Type: Investment ISA
Min. Investment: £10/month

Further information...
A very British investment in the UK stock market from just £10 a month. Get £50 cashback when you pay in at least £50. Capital at risk. £50 early exit fee applies.

Scottish Friendly My Select (ISA)
Account Type: Investment ISA
Min. Investment: £10/month

Further information...
Start investing for your future from £10 a month. Choose from a range of funds to suit your investment goals. Get £50 cashback when you pay in at least £50. Capital at risk. £50 early exit fee applies within the first 5 years.

Scottish Friendly My Select (Junior ISA)
Account Type: Investment ISA
Min. Investment: £10/month

Further information...
Start investing for your child's future today. Open a Junior ISA from £10 a month. Get £50 cashback when you pay in at least £50. Capital at risk. £50 early exit fee applies within the first 5 years.

Scottish Friendly Scottish Bond
Account Type: Investment ISA
Min. Investment: £10/month

Further information...
Make regular investments for 10 years, in addition to your ISA allowance. Get £50 cashback when you pay in at least £50. Life cover included. Capital at risk.

Scottish Friendly Child Bond
Account Type: Investment ISA
Min. Investment: £10/month

Further information...
Invest for a child you care about to help them in the future with a Child Bond from Scottish Friendly. Get £50 cashback when you pay in at least £50. Life cover included. Capital at risk.

What is a stocks & shares ISA?

A stocks & shares ISA (otherwise known as an equity or investment 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 being exempt from income and capital gains tax (other than dividends which may be subject to a tax charge depending on the amount of dividend income you receive).

Unlike cash ISAs, however, the stocks & shares version will actively invest your money across your choice of funds in the stock market. The majority of such accounts use collective investment funds, such as Unit Trusts or Open Ended Investment Companies (OEICs), and investors can either receive a form of income during the term of their investment or can wait until they encash their investment.

What's the difference between a cash ISA and an equity ISA?

The key difference between cash ISAs and equity ISAs is that the cash version holds onto your cash and pays interest at a set rate, while an equity ISA actively invests your money into external funds or company shares for the potential of bigger returns.

However, an equity ISA is not a savings account and should be viewed as an investment product. It's a higher-risk home for your money with the returns based on the performance of the specific funds, and there's a chance you could lose some or all of your initial investment. There are different rules regarding FSCS protection too, with investors currently covered for up to £50,000 instead of the £85,000 that cash ISA savers benefit from.

Buying a stocks & shares ISA - before you get started

Stocks & shares ISAs are more complex than cash versions. There are a number of different products you can choose from and funds you can invest in depending on your goals, with the key decision being whether you want to generate an income (in which case you'd choose income generating funds, denoted by the term "Inc") or want to grow your initial investment (where you'd need accumulation funds, denoted by the term "Acc").

You need to make sure you're comfortable with the level of risk involved, as well as the long-term nature of equity ISAs. There's no guarantee with this kind of investment and you may get back less than you put in, so despite the potential to secure better returns than with a traditional savings account, it's important to weigh up this factor.

It's only really suitable if you're willing to commit your money to an account for the long-term, too, as this will offer the best scenario for growth. While most funds can be sold at relatively short notice, this type of account won't be good for those who may need to dip into their savings in an emergency, so make sure you view it as a longer-term undertaking.

You'll also want to remember that, even though your investments will essentially be held in a tax-free account, there could still be certain tax payments and fund charges applicable. Equity ISAs are exempt from income and capital gains tax, while the taxation of dividends changed in April 2016, so that dividends are also paid free of tax if held within an ISA. However, these ISAs will usually charge fees, so always check the small print to see if the particular account is worth it.

Understand the risks

Any investment comes with an element of risk, particularly those with the prospect of higher returns, and it's important for any potential investor to understand them. Over time there could well be fluctuations in the value of an investment with the total value and any income generated going down as well as up, and in a volatile market some investors may get back less than they put in.

Different types of investment fund have different levels of risk - or to put it another way, they will be more volatile. For example, funds investing in smaller companies or emerging markets will be more volatile than funds that invest in UK blue chip firms. Also, growth funds investing in shares are more likely to be more volatile than funds investing in fixed interest investments such as Government gilts or corporate bonds.

It is usually a good idea to invest across a range of investment types (or asset classes) such as shares, bonds, property and cash to spread your risk. How much you invest in each category will depend on how much risk you are prepared to take, and how long you intend to invest for. Whatever you chose, please note that past performance should never be seen as an indicator of future returns.

Disclaimer: This is a basic guide to stocks & shares ISAs. It does not cover every circumstance and nor is it intended to be a source of advice. This information is aimed at customers within the UK. Tax treatment depends on your individual circumstances and may be subject to change.