Sammie Ellard-King
I’m Sammie, a money expert and business owner passionate about helping you take control of your wallet. My mission with Up the Gains is to create a safe space to help improve your finances, cut your costs and make you feel good while doing it.
Wouldn’t it be great if you could have a tax-free savings account where you can actually buy and sell shares from big companies?
Well, it turns out that you can!
All you need to do is set up the right kind of ISA, specifically a Stocks and Shares ISA.
In this article, we’re going to tell you all about Stocks and Shares ISAs, including a list of providers and platforms, and answering all your most frequently asked questions on the subject along the way.
By the time you get to the wrap up at the end, you can be considered fully informed. But really can I buy and sell shares within an ISA?Â
Please feel free to scroll ahead to any section that jumps out at you. Here goes!
Table of Contents
What Exactly Is A Stocks And Shares ISA Anyway?
A Stocks and Shares ISAs has the same tax efficiency privileges of any ISA. You can use it for up to £20,000 without having to pay any tax on it.
But with a Stocks and Shares ISAs, you also get to invest your money in stocks and shares. And this has the added benefit of a much greater chance of growing larger.
The return on regular cash ISAs are unlikely to beat inflation, but with a Stocks and Shares ISAs you could, if you invest wisely.
What’s more, any profits or dividends you earn with a Stocks and Shares ISAs are entirely tax-free. Unlike investments that aren’t inside an ISA, where the taxable percentages are sometimes quite high.
With a Stocks and Shares ISA, there’s no dividend, capital gains, or income tax to pay.
The only tax you may be eligible to pay is a stamp duty charge which comes in at 0.5%, but this is only applicable when you invest more than £10,000.
What Are The Different Types Of Stocks And Shares ISAs?
Stocks and Shares ISAs fall largely into two main types…
You can get ready-made Stocks and Shares ISAs, where the money holder or financial institution makes all the investment decisions for you.
You usually have the chance to decide your level of risk with this plan. Sometimes these plans are based on scientific algorithms.
Or, you can go ahead and buy stocks and shares yourself, making your own buying and selling investment decisions, creating your own portfolio, with a self-invested Stocks and Shares ISA.Â
Should I Opt For A DIY Or Ready-Made Portfolio?
If you’re not confident in making investment choices yourself, then the ready-made option may be best for you.
However, in addition to paying a platform fee, you may also be charged a fund management fee, which is usually a flat fee or a percentage of total investment that year.
It’s worth noting at this point that ready-made portfolios often offer a special plan where you only invest in companies that care about the environment and society also known as ESG investing.
If you know exactly what companies you’d prefer to invest in, then the DIY option would be better for you, and give you complete control over your investments.Â
What Rules Apply To Stocks And Shares ISAs?
There aren’t many rules that apply to Stocks and Shares ISAs, but there are some. They are as follows:
You have to be aged 18 or over and a UK resident to open a Stocks and Shares ISA. There’s a limit of £20,000 each tax year, and you can only own one Stocks and Shares ISA, each tax year.
If you want to have multiple Stocks and Shares ISAs, you can’t have two open during the same tax year, and you can only pay into them during that tax year. But you are free to transfer your money between ISAs.
How Much Money Can I Make With A Stocks And Shares ISA?
The extent to which your money will grow in a Stocks and Shares ISA depends entirely on what companies you invest in and market conditions.
Financial institutions do their very best to predict how much profit a stock or share will make in the future. But we’re going to level with you here.
You can’t predict everything, and there’s always a chance that you could lose all the money you invest in a Stocks and Shares ISA.
However, if you invest your money in a relatively wide range of stocks and shares, and keep the money there for several years, then there’s a good chance that you will make at least some money from your investments.
It’s important to note at this point that different ISAs are capped at different limits. A Stocks and Shares ISA is capped at £20,000. Which means that you cannot make more than £20,000 with one.
Transferring Your regular ISA To A Stocks And Shares ISA
If you already own an ISA and want to make the switch to a Stocks And Shares ISA, all you have to do is fill in a form from the new provider. However, it will take some time to be processed.
But seriously how many stocks and shares ISAs can I have? Well, the answer is as many as you like but only one in that tax year to benefit from tax relief.Â
Most of the time the bank you’re switching to will have you set up and ready to go within a few hours but sometimes it can take a couple of days to make a switch.
Where Can I Get A Stocks And Shares ISA?
You can open a Stocks and Shares ISA with various institutions, including banks, stockbrokers, fund management companies, and investment platforms.
Here follows a list of some of the best providers of Stocks and Shares ISAs:
- Halifax Portfolio
- Fidelity Personal Investing Cost Focus Portfolios*
- Vanguard LifeStrategy Portfolio
- HSBC Portfolio
- Wealthify
Top five self-invested stocks and shares ISAs
- Barclays Investment ISA
- Hargreaves Landsdown ISA
- Vanguard ISA
- Aviva Stocks and Shares ISA (self-select)
- Wombat
Those we’ve underlined above we have full reviews on if you want to check them out.
If you are unsure of what Stocks and Shares ISA to go for, we would recommend that you book a consultation with a financial adviser.
Wrap UpÂ
So, know you know the answer to can I buy and sell shares within an ISA. You can transfer money from one ISA to another if you want to switch, or you could simply open a new one.
You can choose between a ready-made investment package, or go DIY and build your very own portfolio.
Investments of any type carry a degree of risk, so it may be worth consulting with a financial adviser when making decisions about your money.
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Disclaimer: Content on this page is for informational purposes and does not constitute financial advice. Always do your own research before making a financially related decision.
Can I sell holdings in my shares ISA and replace them with different shares of the same value ?
Yes you can