Making ISAs work for you

July 19, 2019

Chris Black, financial planner at Brewin Dolphin’s Newcastle office, advises on what to do with ISAs and Junior ISAs in 2019

What to do with this year’s ISA?

ISAs are at the core of most tax-efficient portfolios: you don’t have to pay any income tax or capital gains tax on any investment returns achieved.

This tax year adults can put up to £20,000 a year into ISAs. So, for a couple that is £40,000. You can also put up to £4368 into a Junior ISA on behalf of your child.

Don’t delay

Many people don’t utilise their ISA allowances until the end of the tax year, but it could be better to make use of these allowances sooner rather than later.

You could invest the full £20,000 allowance in one go as a lump sum investment or, if you don’t feel ready or able to invest a lump sum, ‘drip feeding’ your money into the stock market on a monthly basis could be a smart way to make the most of your ISA allowance over the whole tax year.

Working harder

There are two main types of ISA – cash and stocks and shares. Cash ISAs have historically been the more popular1, though they are not risk-free. Cash ISAs have been paying less interest than the rate of inflation in recent times, meaning they have not kept up with rising prices and have therefore lost value in ‘real’ terms.

We think that savers with a longer time horizon and appropriate risk profile should be looking to make their money work harder. Stocks and shares ISAs invested in the stock market offer the potential to earn higher returns than cash ISAs, to offset the impact of inflation and hopefully increase the ‘real’ terms value of the investment.

Children can benefit too

Junior ISAs (JISAs) are open to all under-18s who are resident in the UK.

With a JISA, the money is locked away until the child’s 18th birthday, at which point it converts to an adult ISA and they can access the funds. Only parents or guardians with parental responsibility can open a JISA on behalf of a child, but anyone can contribute – be they grandparents, godparents or friends. Children aged between 16 and 18 can apply for a JISA themselves and become the registered contact.

The value of investments and any income from them can fall and you may get back less than you invested.

Past performance is not a guide to future performance.

No investment is suitable in all cases and if you have any doubts, then you should contact us. Please note that this document was prepared as a general guide only and does not constitute tax or legal advice. While we believe it to be correct at the time of writing, Brewin Dolphin is not a tax adviser and tax law is subject to frequent change. Tax treatment depends on your individual circumstances; therefore, you should not rely on this information without seeking professional advice from a qualified tax adviser.

Brewin Dolphin
If you would like to discuss how to invest your ISA or how to make your investments more tax- efficient, call 0191 279 7300 or email

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