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• A to Z of Savings Accounts

Individual Savings Accounts are savings schemes which were introduced in 1999 to encourage people to save by offering a tax free investment vehicle.

ISAs allow you to save money in a range of investments such as cash, stocks and shares, and life insurance products. You can have an ISA:

• If you are aged 16 or over (although until your 18th birthday you can only invest in a cash ISA); and
• If you reside in the United Kingdom for tax purposes (or are a Crown employee currently working overseas and treated as resident, or are married to a person who performs such duties);

You cannot hold an ISA jointly with anyone else, or hold one on behalf of another person.

In tax year 2008-09 you can invest up to £3,600 in a cash ISA and this will be  completely tax free and you therefore do not have to mention cash ISAs on your tax return.

If you hold a TESSA only ISA (TOISA), these have been re-designated as cash ISAs since 6 April 2008.

Another change in the tax year 2008-09 is that for the first time, you can  switch a cash ISA into a stocks and shares ISA, without this affecting your total annual ISA allowance which for the tax year 2008-09 is  £7,200. £3,600 of this can be invested in stocks and shares).

Money held in child trust fund accounts can also be rolled over into an ISA once a child reaches age 18.