ISA PEPs

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ISAs and PEPs

An ISA is an Individual Savings Account. It is basically a way to wrap up your investments - either cash or shares - so you don't have to pay tax on them.

Think of it like a box. Inside the box you can put cash, shares, funds or some life insurance policies. The box protects anything inside it from the taxman so you don't have to pay tax on any increase in your investment, or on any dividends you receive.

ISA and PEP limits

There are limits each tax year to the amount you are allowed to invest and you can only open one new ISA in any tax year. You don't have to put all the money in at once - you can add to an ISA during the tax year at regular intervals, or occasionally when you are able, within the annual limits.

• See our Tax Guide for details.

Compare ISAs

With the new cash limit at £5,100 - now's a good time to grab an ISA.

	Virgin Climate Change ISA An environmental fund with potential for outstanding profit growth without destroying the planet.
	Legal & General ISA Legal & General offer a wide variety of ISAs from Index tracker ISA's to Multi Manager ISAs. 50% refund on some management fees.
	TD Waterhouse - Stocks and Shares ISA Voted best online broker 2007. Offering self select ISA's with a choice of over 1,800 unit trusts, with 0% administration fee.

You can keep the same ISA open for longer than one tax year and continue adding into it after the first year, but if you do this you won't be allowed to open another ISA. Alternatively you can open a different ISA every tax year.

ISA choices

In the past there were two options - a Maxi ISA or a Mini ISA and the consumer could choose whether to open one maxi ISA or up to three mini ISAs (one of each of cash, shares and insurance). However, the 2008 budget changed the legislation on ISAs, and maxi and mini ISAs no longer exist. The new legislation separates ISAs into Cash ISAs and Stocks and Shares ISAs.

Within these two main options, there are various different types of ISA, although the 2008 budget transfers some of these into different categories, either as Cash ISAs or Stocks and Shares ISAs. Click here for details of:

• Cash ISAs
• Share ISAs
• Ethical ISAs
• TESSA-only
• ISAs National Savings
• ISAs PEP Transfers
  

You can get an ISA from any ISA manager. They include banks, building societies, some retailers, insurance companies, investment and unit trust companies, financial advisers, stockbrokers and friendly societies. See our Providers' Pages or complete our Quick Enquiry Form for more information. Your ISA will continue until you decide to withdraw your cash or investment.

You can get an ISA from any ISA manager. They include banks, building societies, some retailers, insurance companies, investment and unit trust companies, financial advisers, stockbrokers and friendly societies. See our Providers' Pages or complete our Quick Enquiry Form for more information.Your ISA will continue until you decide to withdraw your cash or investment.