Nisa Q&A: all you need to know about the New Isa
What is a New Isa?
New Isas (Nisas) replaced individual savings accounts (Isas) from 1 July 2014. Savers have an annual allowance of £15,000 and can put as much of it as they like into any combination of cash and/or stocks and shares.
How many Nisas can I have?
Only one cash Nisa and one stocks and shares Nisa can be opened in any single tax year.
What if I've already paid into a 2014/15 Isa?
Isas opened before 1 July will automatically turn into Nisas and the £15,000 Nisa subscription limit for the rest of the 2014/15 tax year reduces by any amount already paid in to Isas between 6 April 2014 and 30 June 2014.
Most providers will allow you to top-up to the full £15,000 upper limit, but they may only do so for a set period (some fixed-rate Nisa providers are doing so for just the first two weeks of July).
Can I transfer my old Isas to a Nisa?
Yes, previous years' Isas can be transferred into cash and stocks and shares Nisas as often as you wish. For the first time, money can also be transferred from stocks and shares accounts into cash accounts rather than just the other way round.
Whenever you wish to make a transfer, you will have to check the new Nisa provider allows additional amounts to be added.
How long will a transfer take?
Transfers between cash Nisas should be completed within 15 business days but other transfers will take up to 30 working days.
Can I hold cash in a stocks and shares Nisa?
Yes, as long as your provider allows you to. There is no maximum that can be held in cash (beyond the £15,000 Nisa limit itself), nor is there a maximum time period. Any interest earnt on the cash will not be subject to a flat rate charge of 20%; however, the rate of interest paid will likely be lower than you'd earn in a cash Nisa.
Can I hold a peer-to-peer loan in my Nisa?
Not yet, but you could be able to by the end of the year. The government is planning to run a consultation on the best way to go about it.
Are Junior Isas (Jisas) changing too?
Yes. From 1 July the amount that can be paid into a Jisa increases to £4,000, up from £3,840 at the beginning of the 2014/15 tax year.
Where can I buy a Nisa?
Banks and building societies typically offer cash Nisas, while investment companies and online execution-only platforms provide stocks and shares and Junior Nisas. Friendly societies also offer cash Nisas, investment Nisas and Jisas.
Invidivual Savings Accounts were introduced on 6 April 1999 to replace personal equity plans (PEPs) and tax-exempt special savings accounts (TESSAs) with one plan that covered both stockmarket and savings products, the returns from which are tax-exempt. The ISA is not in itself an investment product. Rather, it’s a tax-free “wrapper” in which you place investments and savings up to a specified annual allowance where the returns (capital growth, dividends, interest) are tax-exempt (you don’t have to declare ISAs and their contents on your tax return). However, any dividends are taxed within the investment, and that can’t be reclaimed.
Describes the relationship between a client and a stockbroker or independent financial adviser whereby the broker or adviser acts solely on the client’s instructions and doesn’t offer any advice on which shares to invest in or financial products to buy and simply “executes” the wishes of the client, regardless if they are judged to be sound or wrong. Other types of broking service offered are advisory (whereby the client/investor makes the final decisions, but the broker offers advice) and discretionary (whereby the broker manages the portfolio entirely and makes all the decisions on behalf of the client).