ISA

ISA

How do ISAs work?

An ISA shelters your investments from personal income tax and capital gains tax.

You can subscribe to an ISA if you are:

Aged 18 or over
Resident and ordinarily resident in the UK for tax purposes

There are four main types of ISAs; investing in either stocks and shares ISA, cash ISA, Innovative Finance ISA or a Lifetime ISA.

You can invest up to £20,000 in your ISA during the 2024/2025 tax year
You can transfer money held in an ISA from stocks and shares into cash and vice versa, without affecting your annual allowance
You can choose how to split your tax-efficient savings yourself. For example, you can save the full amount in stocks and shares or the full amount in cash – or you can invest in a combination of the two depending on your individual investment needs

The value of your investment can go down as well as up so you might not get back the amount you put in.

The tax rules for ISAs may change in the future, and their tax advantages depend on your individual circumstances.

Please note that any losses made in an ISA cannot be used to offset gains elsewhere.

Invest in a tax-efficient Individual Savings Account (ISA) with myM&G

You can invest up to £20,000 per tax year (2024/2025) – with either a lump sum or with regular monthly contributions
At myM&G we offer a stocks and shares ISA only. Due to our focus on long-term investing, the ISA with myM&G is not a Flexible ISA, Innovative Finance ISA or a Lifetime ISA
You can hold a dynamic mix of equities (shares in a company), bonds (a loan in the form of a security, usually issued by a government or company, also known as fixed income) and even multi-asset funds to suit your individual needs
If you’re waiting for the right time to invest or are unsure about which funds to invest in, then you can hold your money in our 'Cash Park'. This allows you to temporarily (as a guide, no longer than six months) hold cash in a an ISA or a Junior ISA until you’re ready to make a decision on where you want to invest. Please note, your money won't earn you any interest in the 'Cash Park'
We'll never charge you for transferring to another provider, and we'll always give you instant access to the money in your ISA
Because your ISA is a protective tax-efficient home for your investments, you won't pay personal income or capital gains tax on your profits. Please be aware that losses made in the ISA cannot be used to offset gains elsewhere
Tax-efficient status also means you can still claim any tax allowances that you're due because of your age or personal circumstances
Our Stocks and Shares ISA is available to all full UK residents aged 18+, with income shares available for most of the funds we offer
Finally, in the unfortunate event of your death, your spouse will be entitled to an additional ISA subscription equal to the value of your ISA at the date of your death (this can be invested with myM&G or can be transferred to another provider)

In the table below, you'll see how Stocks and Shares ISAs compare to Cash ISAs.

Please note, myM&G do not offer a Cash ISA.

	Stocks and Shares ISAs	Cash ISAs
Designed for	Longer-term investments for five years or more, letting you share in the potential growth of the stockmarkets	Short-term savings for less than five years, with no real risk to your money. But the real-life 'spending power' of your investment may gradually fall if the interest rate you're getting is lower than the UK's annual rate of inflation
Maximum investment	£20,000 (2024/2025 tax year) - you can split your overall annual ISA allowance between Cash, Stocks and Shares, Innovative Finance and/or Lifetime ISAs* as you wish	£20,000 (2024/2025 tax year) - you can split your overall annual ISA allowance between Cash, Stocks and Shares, Innovative Finance and/or Lifetime ISAs* as you wish
Investment options	You can choose from a wide range of investments including funds, trusts, bonds and individual shares	With a Cash ISA there's no choice of investments – you'll simply get interest on your savings at a fixed or variable rate
Risks and returns	Depending on the performance of your investments, the value of your ISA can fall as well as rise	A Cash ISA offers very little risk to your money, with interest added every year, or sometimes more frequently
Taking your money out	You can normally withdraw cash from your account within eight to ten days	Variable interest accounts normally offer instant access. But with fixed term accounts, you could lose interest if you withdraw cash early

*Since April 2017, 18-40 year olds have been able to open a Lifetime ISA and pay in up to £4,000 each tax year. They will be able to continue making contributions up to the age of 50. The government will add a 25% bonus to all contributions to a Lifetime ISA within the limits. However, it is important to note that the Lifetime ISA will count towards your annual ISA allowance.

MyM&G provides you with a great range of funds to choose from, plus all the benefits of nearly 100 years of investment experience and an active approach to investing.

We focus on helping you get the best from your money and enabling you to do all your investing in one easy place.

Target Market Information

This document explains who we believe the product is, and is not, suitable for. This is based on M&G’s opinion and doesn’t take into account your individual circumstances.

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