Trading ISA
What is a Stocks and Shares ISA?
Individual Savings Accounts (ISAs) are tax-efficient savings accounts, and you do not have to declare any income from them on your UK tax return. You can use an ISA to save cash or invest in stocks and shares.
A ‘Self-Select’ Stocks and Shares ISA gives you a wide range of investment choices by putting you in control of managing your own share portfolio, and any growth is protected from Capital Gains Tax.
TD Direct Investing offers a Trading ISA which is a Stocks and Shares ISA, but we don’t offer a Cash ISA.
How much tax will you save?
Saving your money inside an ISA is more tax-efficient than leaving cash in a bank or building society account.
On savings interest outside an ISA, you would pay:
- 20% tax if you pay tax at the basic rate
- 40% or 50% tax if you pay tax at the additional rates
On dividend income:
- For UK equities, if you're a basic rate taxpayer, you are deemed to have paid tax at 10% on dividend income whether inside or outside an ISA. This is taken as a 'tax credit' before you receive the dividend and cannot be refunded for ISA investments.
- For UK equities, if you're a higher rate taxpayer, you would normally pay tax on dividend income at 32.5% or 42.5%. Inside an ISA you won't get back the 10% dividend tax credit element of this, but you will save by not having to pay any additional tax.
How much can you invest?
Everyone aged 18 and over can invest up to £10,680 in a Stocks and Shares ISA each year.
What about Capital Gains Tax?
If you make gains of more than £10,100 from the sale of shares and certain other assets in a tax year, you would normally have to pay Capital Gains Tax. You do not have to pay any Capital Gains Tax on gains from an ISA. Losses on ISA investments can't be used to reduce Capital Gains Tax on gains from investments made outside the ISA.
What are the ISA limits?
Up to half of your annual allowance can be invested in a Cash ISA, with the remainder invested into a Stocks and Shares ISA. Alternatively you can invest the full allowance in a Stocks and Shares ISA such as the TD Trading ISA.
When are the tax deadlines?
The tax year ends on 5th April each year. This is the deadline for making the most of your annual ISA allowance, as your unused ISA allowance can’t be carried over to the next tax year.
Open a Trading ISA Today
Online
You can set up your account online today!
By Phone
By Post
Complete and return an Application Form to TD Direct Investing
Existing Customer
Online
You can add a Trading ISA alongside your other trading accounts by visiting our Account Upgrades page online.
Login now and click the Account Administration menu, then select Account Upgrades.