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Guide to ISAs: allowances and rules explained

What is an ISA?

Tax-free savings account
An ISA is an Individual Savings Account that enables you to save or invest money without paying tax on the interest or on the investment returns you receive.

To open an ISA, you need to be a UK resident for tax purposes and aged 16 or over. For some ISAs, you may need to be 18 or over.


Annual allowances
For each tax year, there’s a limit to the amount you can deposit into your ISA – this is your annual allowance. The allowance for the 2014/2015 tax year is £15,000, which you can invest in a cash ISA, an investment ISA or a combination of the two.


Tax-free interest every year
The tax year runs from 6 April to 5 April. Each tax year, you can either open a new ISA or top up an existing ISA until you reach your annual allowance. You’ll then earn tax-free interest on your whole balance every year.
 

Cash ISA vs investment ISA

You can choose to open and save money in a cash ISA, an investment ISA or split your allowance between one of each in any single tax year.

A cash ISA may suit you best if you’re simply looking for a low-risk savings option with easy access to your money. If you’re prepared to take on some risk for a potentially higher return, you might want to consider an investment ISA.

Take a look at our comparison table to help decide which ISA is best for you.

  Cash ISA Investment ISA
Interest rate

Variable or fixed – depending on the cash ISA you choose

Linked to the stock market

Opening deposit amount

£1

£500 (if investing in funds)

Access to your money

Instant or flexible – depending on the cash ISA you choose

Should be held for the medium to long term (5-10 years). Investments can usually be withdrawn at any point, but you may be charged or see the value of your investments fall

Risk

Low risk

Risk of losing some or all of your money

Charges

No administration or management costs for Barclays cash ISAs. Our fixed-rate cash ISA allows you to make 3 withdrawals free of charge

Annual management charges, fund administration and ISA administration fees

ISA calculator

If you’re considering opening both a cash ISA and an investment ISA, our calculator can help you work out how much you could save in each account in 1 tax year.

 

How much are you looking to save and invest?

 
 
 
£0 £15,000
 
Cash ISA:£0
 
Investment ISA:£0
 
Unused allowance:£0

Transferring your ISA

Why transfer?

If you have more than 1 ISA (cash or investment) and you’d like to combine them or you’d like to transfer your money into a new ISA, it’s best to use the ISA Transfer Service to move or combine your savings.

If you simply withdraw money as cash and pay it into a new ISA, your money will no longer be tax-free and it will count towards your annual allowance for the current year – even if your new ISA is with the same bank.

Using the ISA Transfer Service means that the interest you earn on your money will remain tax-free and previous year’s savings you transfer won’t count towards your current annual allowance.

Remember, you can transfer all or just some of your other ISA balances, and you can also transfer between cash and investment ISAs.

How to transfer

It’s easy to make a transfer to us – if you’re registered for Online Banking, simply log in to complete a transfer form giving us the account details of the other ISA(s) and we’ll do the rest.

Alternatively, you can call us on 0345 744 5445 1 or pop into a branch to arrange an ISA transfer.

It can take up to 15 working days for any cash ISA transfer to be completed, and a bit longer for investments. While the transfer takes place, any money in investment ISAs may not be invested in the stock market.

Withdrawing money from an ISA

While you can only make deposits into 1 cash and 1 investment ISA each tax year, you may be able to withdraw money from your current or previous year’s ISAs at any time – depending on the terms of your particular ISA.

Our ISAs

Home insurance

Cash ISA

Whether you're looking for a fixed rate on savings or instant access to your money, we offer 2 types of cash ISA – so you can choose which suits you best.

Investment ISA

Investment ISA

You can open an investment ISA on its own or as well as your cash ISA, as long as the combined deposit is no more than £15,000.

FAQs

  • If I open a cash ISA at the end of one tax year, what happens to the interest in the new tax year?

    The interest you earn on your money in a cash ISA remains tax free for the life of the ISA, providing all ISA conditions are met. The rate of the interest paid might change, but it will remain tax free. However, the government may change the ISA rules in the future.

  • If I transfer my previous years’ deposits into a new ISA, does it count towards my current tax year ISA allowance?

    No, it doesn’t. You are free to transfer previous years’ ISA funds into a new cash or investment ISA and this won’t count towards the current year’s allowance. For example, if you have £20,000 in previous ISAs, you can transfer the balance into your new ISA and still have your £15,000 allowance for the current tax year. The interest on the combined balance will also be tax free.

    When transferring between ISAs, remember that if you withdraw the money as cash and pay this directly into your new ISA, the interest you’ll receive will no longer be tax free. This applies even when transferring between ISAs in the same bank. So it’s important to complete a transfer form, which you can do in branch, over the phone or by logging into Online Banking.

Important information
1. Lines are open Monday to Friday 8am-9pm, Saturday 9am-8pm and Sunday 10am-4pm. To maintain a quality service, we may monitor or record phone calls. Read our call charges and information

Barclays Bank PLC. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority (Financial Services Register number: 122702). Barclays Bank PLC subscribes to the Lending Code which is monitored and enforced by the Lending Standards Board. Further details can be found at www.lendingstandardsboard.org.uk. Barclays Insurance Services Company Limited is authorised and regulated by the Financial Conduct Authority (Financial Services Register number: 312078).

Barclays Bank PLC. Registered in England. Registered no. 1026167. Barclays Insurance Services Company Limited. Registered in England. Registered no. 973765. Registered office for both: 1 Churchill Place, London E14 5HP. ‘The Woolwich’ and ‘Woolwich’ are trademarks and trading names of Barclays Bank PLC. Barclays Business is a trading name of Barclays Bank PLC.


 

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