Compare stocks and shares ISA

Investment ISAs, such as a stocks and shares ISAs, let you invest in different markets and could earn you a tax free profit.

Investment ISAs put your capital at risk, and you may get back less than you originally invested.

7 results found, sorted by affiliated products. How we order our comparisons. Commission earned affects the table's sort order.
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Investment type

Scottish Friendly My Choice (ISA)
Invest from
£100 lump sum or £10 a month
You can invest in
10 funds
Manage your ISA online with flexibility; increase, decrease, pause & restart payments. Invest from £10 p/m & get a gift worth up to £45. With over 150 years of experience & a UK based team, Scottish Friendly welcome all investors.
Capital at risk. ISA & Gift rules apply.
Eligibility
Permanent UK Resident
Minimum Initial Deposit£100
Minimum Monthly Investment£10
Minimum Lump Sum Stocks & Shares ISA Investment£100
BMO Stocks & Shares ISA
Invest from
£100 lump sum or £25 a month
You can invest in
10 funds
Serving customers for over 200 years. Invest for your future with a BMO Stocks and Shares ISA and join over 12 million customers worldwide. BMO's 10 Investment Trusts enable you to invest in a specific region or globally.
Capital at risk.
Eligibility
Permanent UK Resident
Minimum Initial Deposit£500
Minimum Monthly Investment£25
Minimum Lump Sum Stocks & Shares ISA Investment£100
Wesleyan With Profits Stocks and Shares ISA
Invest from
£1,000 lump sum or £50 a month
You can invest in
1 fund
Wesleyan has been looking after the financial interests of members since 1841 and the With Profits fund is managed by its award-winning investment team. Review your investment online and get service from the UK-based customer support team.
Capital at risk.
Eligibility
Permanent UK Resident
Minimum Initial Deposit£1,000
Minimum Monthly Investment£50
Minimum Lump Sum Stocks & Shares ISA Investment£1,000
Hargreaves Lansdown Stocks and Shares ISA
Invest from
£100 lump sum or £25 a month
You can invest in
Over 3,000 funds
Kickstart your investing with an award-winning ISA. Choose your own investments with expert research and ideas to help you, or simply pick a ready-made portfolio. Manage via website, app or phone.
Capital at risk.
Eligibility
Permanent UK Resident
Minimum Initial Deposit£100
Minimum Monthly Investment£25
Minimum Lump Sum Stocks & Shares ISA Investment£100

This article is designed to offer you impartial guidance as to your options and what they might mean, but the decision on which product to take out is yours.

What is a stocks and shares ISA?

A stocks and shares ISA, also known commonly as an investment ISA, is a type of tax-efficient investment account. It allows you to earn a return by investing your money in a variety of shares, funds, investment trusts and bonds.

Thanks to the annual ISA allowance any returns you earn are tax free. This means that you won't have to pay dividend, capital gains or income tax on any profits you make from the investments held in a stocks and shares ISA.

For each tax year, everyone in the UK over the age of 18 is granted an ISA allowance. For the 2021/22 tax year, the annual ISA allowance is £20,000 per person. You can only pay into one investment ISA per tax year. But you can open a new one each year.

You can either use your entire ISA allowance for a stocks and shares ISA or you can split it between different types of ISAs. These include:

Read more about what ISAs are here

What types of investments can you invest in with a stocks and shares ISA?

There are many different types of investments that you can make with varying levels of risk.

  • Stocks or shares are essentially slices of ownership in a given company. The value of a share is calculated by dividing the total market value of the company by the number of shares. The value of each share can vary depending on how the company performs and other external economic factors. When you buy shares, the aim is to earn profit by selling the shares when they rise in value.

  • Investment funds are 'collective' investments which pool your money with other investors. A fund manager uses that money to buy and sell a wide range of investments on your behalf, in order to achieve a fund’s objective. These investments can include shares in companies, real estate, or government bonds.

  • Open Ended Investment Companies (OEICs), which are professionally managed collective investment schemes that pool your money with other investors.

  • Unit trusts work by pooling your money with other investors into a single fund, which is managed by a fund manager. The fund manager then uses the unit trust fund to invest in asset classes through a variety of securities.

  • Investment trusts are publicly listed companies that invest in financial assets or the shares of other companies on behalf of their investors. When you invest you are buying shares in an investment trust, the value of which fluctuates based on the underlying value of the assets they own and the supply and demand for their shares.

  • Exchange traded funds (ETFs), are a type of security that track an index, sector, commodity, or other asset, which can be purchased or sold on a stock exchange just like a regular stock.

How do I choose what to invest in?

If you've never invested before, it's important to do your research and understand how the process works and what you may need to look out for before you invest your money.

Luckily, there are many outlets where you can find valuable information that can prove to be useful. Here are a few examples:

Hargreaves Lansdown is a great resource if you're new to investing. They have a vast collection of tips and guides that cater to different investing goals.

Interactive Investor is another helpful resource. Whether you're just starting out or a seasoned investor, it had database of helpful guides and content from experts, including insight on some of their model portfolios have performed.

IG is a trading platform that also helps you stay on top of market events and gain insight into their likely impact with our news and commentary service. You can find expert coverage and unique perspectives on the latest global developments to inform your investment decisions.

Which stocks and shares trading platform should I choose?

There are two types of trading platforms:

1. Do-it-yourself platforms

These are trading platforms which allow you to pick where you invest, and for how long. These are best for experienced investors who know what they're doing. You'll need to:

  • Do your own research

  • Picking your own investments

  • Manage your portfolio yourself.

 2. Do-it-for-me platforms

With these platforms, everything is taken care of for you and are typically used by first-time or inexperienced investors. These platforms will pick your investments based on:

  • How much you want to invest

  • How much your willing to risk

  • What your investing goals are

  • The kinds of investments you prefer

Should you invest in a stocks and shares ISA?

Whether or not you should invest in a stocks and shares ISA depends on your financial circumstances, your savings goals and the amount of risk you're willing to take.

You could earn more by putting your money in an investment ISA than you could by putting it in a cash ISA. But it's important to understand that investing in stocks and shares is risky. The stock market is unpredictable and there are no guarantees.

To help you find the best performing stocks and shares ISA, you might also like to read our guide on investment ISAs for more information.

Pros and cons of stocks and shares ISAs

There are lots of reasons why you might like to get a stock and shares ISA. But there are downsides too:

Pros

  • The return on your investment could be a lot higher than what you could earn from interest on a cash ISA
  • Because you invest using your ISA allowance, any stocks and shares ISA returns you make are free from income tax
  • You can invest in several markets.

Cons

  • You could lose your money if the funds you invest in don't perform well
  • Your money's protected up to £85,000 per firm you invest with under the FSCS if the firm failed after 1 April, 2019.

How to choose the best stocks and shares ISA for you

When you're looking for the best stocks and shares ISA, your experience and knowledge of the stock market should be a factor.

If you don't know how to pick the right funds to invest your ISA in, or you're a beginner, then an investment fund might be the best option for you. If you do know how you want to invest your ISA, then a self-select ISA might be a good option for you. With one of these, you can tailor your ISA stocks and shares investments. You can include individual shares and funds from a wide range of markets.

How much does a stocks and shares ISA cost?

Investing isn't free, but the idea is that whatever costs you incur to invest will be outweighed by the returns. This is why it's important to watch out for charges, because they can eat into your investment returns.

Some of the costs that you should be aware of include:

  • Transaction fee: This is charged every time you buy or sell a share on a platform. If you're a frequent trader, then you'll want to find a platform with the lowest fee possible. If you're long term investor, then it won't matter as much.

  • Trading Platform charge: Not only does the trading platform help you execute your transactions, many also provide you with insight and analysis to help you make investing decisions, all of which isn't free. The platform fee can be flat fee or percentage value of the amount of money you invest. Typically, the more you invest, the more you'll have to pay in fees.

  • Fund manager charge: When you have stocks and shares ISA, the fund manager who manages the investments within your ISA charges a fee. Typically, this is a small percentage of the amount of money you have invested in a fund.

  • Transfer fee: If you decide to change trading platforms, you'll likely have to pay a transfer fee. This is usually charged on a per fund bases, so if you have more than one fund in your stocks & shares ISA, you'll be charged for each one.

Are there any specialist stocks and shares ISAs?

Yes. You, when you're thinking of getting a stocks & shares ISA, you could look into the following options:

Are ISAs the best way to maximise your savings interest?

You may be considering an ISA as way to maximise the interest you earn from your savings, as ISA interest is tax free.

However, saving money in an ISA is no longer the only way to earn tax-free interest.

The personal savings allowance lets you earn a set amount of money each tax year before you have to pay tax on your earnings, including your savings interest.

In the 2021/22 tax year, the personal savings allowance lets you earn up to £1,000 (for basic-rate tax payers, £500 for higher-rate) without paying any tax.

This means that you will only pay tax on savings interest if the amount of interest you earn exceeds your starting rate for savings (if you earn under £17,500) and your personal savings allowance, and if your total income exceeds your personal allowance (£12,570 in the 2021/22 tax year).

For most savers, the interest you earn will therefore not be taxed. You could save your money in whatever account offers you the best deal without having to worry about paying tax on your earnings.

However, if you're likely to exceed your personal savings allowance, then an ISA can still be a great way of maximising the money you earn in interest.

Are stocks and shares ISAs covered by the Financial Services Compensation Scheme (FSCS)?

Yes, most ISAs, including stocks and shares ISAs are covered by the FSCS up to £85,000 per person, per institution. These means that in the unfortunate event that your ISA provider or fund manager were to go bust, you'd be covered up to that amount.

However, this does not mean that you are protected if the investments in your stocks and shares ISA were to lose value from fluctuations in the stock market.

Always be aware that stocks and shares ISAs put your capital at risk, and you may get back less than you originally invested.

Do you have to pay tax on earnings from stocks and shares ISA?

The simple answer is no. Here's why: If you were trading stocks and shares in the open market, you'd have to pay Capital Gains Tax (CGT) on any profits that exceed £12,300 (2021/22 tax year).

If you're a basic rate taxpayer, you'd pay a CGT rate of 10%. If you are a higher or additional rate taxpayer you'd CGT of 28%.

But by investing through a stock and shares ISA, any profits you earn, including any above the £12,300 threshold, are tax free.

The same goes for dividends.

Any dividend income that falls outside your personal Allowance, which is the amount of income you can earn each year without paying tax, could be taxable.

But you also have a tax free dividend allowance of £2,000. So any dividends that exceed your dividend allowance would have dividend tax deducted based on the tax band you fall into.

Again, however, these taxes would not be applied to any dividend income you earn through stocks held in a stocks and shares ISA.

The most significant advantage and feature of a stocks and shares ISA is that any profits you make are tax free.

Our top tips on stocks and shares ISAs ...

  • Invest your money for at least five years to ride though ups and downs in the market. If you think you'll need access to that money sooner, then a stocks and shares ISA may be not be a good option.

  • Invest money regularly to maximise your long term returns. Even investing small sums regularly can add up over time.

  • Don't panic if the market takes a dip. Ups and downs are expected in the stock market. If you're investing for the long term, a momentary dip is unlikely to hurt you.

Stocks and shares ISA FAQs

How many investment ISAs can I have?

You can only pay into one investment ISA each tax year, but you can open and pay into a new investment ISA in each future tax year.

How can I track the performance of my investment ISA?

Most let you track the performance online or you could also ask your financial advisor for a valuation if you invested through one. Read this guide for more.

Is a good return guaranteed in an investment ISA?

No, you could lose money in an investment ISA due to the volatility of the stock market.

How long should I invest for?

Investing is for the long-term. If you decide to start a stocks and shares ISA, it's a good idea to invest for at least five years if you can. That's so that any ups and downs in the market have time to even out, and you don't lose money.

Can I transfer my cash ISA into an investment ISA?

Yes, but only if the company accepts ISA transfers. There may also be charges for transferring into an investment ISA, find out more here.

Can I invest in a cash ISA too?

You can save into a cash ISAinnovative finance ISA and a stocks and shares ISA in each tax year, but only up to £20,000 between all three types.

About our investment ISAs comparison

Who do we include in this comparison?

Our comparison tables include providers we have commercial arrangements with. The number of listings in our tables can vary depending on the terms of those arrangements, as well as other market developments. They are all from providers regulated by the Financial Conduct Authority (FCA).

Here is more information about how our website works.

How do we make money from our comparison?

We have commercial agreements with some of the companies in this comparison and get paid commission if we help you take out one of their products or services. Find out more here.

You do not pay any extra and the deal you get is not affected.

Last updated: 30 July, 2021