TESSA-Only ISA

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TESSA-Only ISA

Under changes introduced in the 2008 budget, TESSA-Only ISAs will automatically become Cash ISAs.

What is a TESSA?

TESSA stands for Tax Exempt Special Savings Accounts.

They were available for five years and investors were allowed to place up to a total of £9,000 in them over that period. The last day you could open a TESSA was April 5th 1999 so all remaining TESSAs will now have matured. You can re-invest the original capital held in your TESSA for up to six months after your TESSA matures. Many providers offer a TOISA - a TESSA-only ISA - which is a special wrapper designed to hold your former TESSA investment. See our Providers' Page.

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 invest up to your full TESSA limit of £9,000 without affecting the usual ISA limits and, if you want to, you can open a mini or a maxi ISA in the same tax year.

See our Tax Guide

You can reinvest the capital in a cash mini ISA or the cash component of a maxi ISA, though many providers don't offer this service and insist on a TESSA-only ISA instead. They are likely to offer different interest rates on these so it is advisable to keep a close eye on rates.