Stocks and Shares ISA A tax-efficient account allowing UK residents to invest up to £20,000 per year in stocks, funds, and ETFs, with all growth and income completely free of UK tax.
The Stocks and Shares ISA is the most important investing account for most UK residents. Contributions are made from after-tax income, but all subsequent growth, dividends, and interest are sheltered from tax permanently, including when withdrawn. There is no capital gains tax on profits, no income tax on dividends, and no tax on withdrawals. The £20,000 annual allowance resets each 6 April and cannot be carried forward. Money can be accessed at any time without penalty (unlike a pension), making it more flexible for goals before retirement age. From April 2024, investors can open multiple ISAs of the same type in the same tax year. For most UK investors beginning to invest, the Stocks and Shares ISA is the natural first account, fill it before investing in a general investment account, and prioritise it alongside pension contributions based on your tax position. Related terms:  ISA, annual allowance, capital gains tax, SIPP, platform Full page:  nofrillsinvesting.com/glossary/stocks-and-shares-isa/