Stock and Share ISA

What is a Stocks and Shares ISA?

A Stocks and Shares ISA (Individual Savings Account) is a tax-efficient wrapper that allows UK residents to invest in a range of assets — such as shares, bonds, and funds — without paying income tax on dividends, interest, or capital gains tax on any profits made within the account. Tax treatment depends on your individual circumstances and may change in future.

Who is eligible to open a Stocks and Shares ISA?

To open a Stocks and Shares ISA you must be aged 18 or over and a UK resident for tax purposes (or a Crown servant, such as a diplomat or member of the armed forces serving overseas, or their spouse or civil partner).

How much can I invest in my Stocks and Shares ISA?

The annual ISA allowance for the 2025/26 tax year (6 April 2025 to 5 April 2026) is £20,000. This is the total amount you can pay across all types of ISA you hold in a single tax year — including Cash ISAs, Stocks and Shares ISAs, Innovative Finance ISAs, and Lifetime ISAs. The allowance has been frozen at £20,000 until at least the 2029/30 tax year.

Can I hold more than one Stocks and Shares ISA?

Yes. Since April 2024, you can open and contribute to multiple ISAs of the same type in the same tax year, provided your combined contributions across all ISAs do not exceed the £20,000 annual limit.

What are the tax benefits?

Within a Stocks and Shares ISA you pay no UK income tax on dividends, no UK tax on interest, and no UK capital gains tax on profits. You also do not need to declare ISA holdings or income on your Self Assessment tax return. Tax treatment depends on your individual circumstances and may change in future.

Can I withdraw money from my Stocks and Shares ISA?

Yes. You can withdraw funds at any time without penalty. However, please note that unless your ISA is a “flexible” ISA, any amount you withdraw does not restore your annual allowance for that tax year. Additionally, selling investments to raise cash may take several business days depending on the assets held. The good thing is Emma Stocks and Shares ISA is flexible so you don't have to worry about your allowance.

Can I transfer my ISA to or from another provider?

Yes. You can transfer your ISA — in full or in part — to another provider at any time, and the transfer does not count towards your annual allowance. Since April 2024, partial transfers are permitted for contributions made in the current tax year as well as previous years.

What happens to my ISA if I exceed the annual allowance?

If you contribute more than £20,000 across all your ISAs in a single tax year, the excess amount will lose its tax-free status. You should contact HMRC as soon as possible on 0300 200 3300 to report the overpayment and arrange for the excess to be corrected.

What happens to my ISA allowance if I don’t use it?

Your ISA allowance does not roll over. Any portion of the £20,000 that you do not use before midnight on 5 April each year is lost and cannot be carried forward to the next tax year.

What happens to my ISA if I die?

ISA investments form part of your estate for Inheritance Tax purposes. However, an Additional Permitted Subscription (APS) may allow your surviving spouse or civil partner to invest an additional amount equal to the value of your ISA holdings, over and above their own annual allowance, in order to retain the tax advantages.

Updated on: 11/02/2026