Making the most of your ISA Go compare with our comparison table

Making the most of your ISA

21 February 2011 / by Rebecca Sargent

ISAs (Individual Savings Accounts) are one of the only means of saving and investing without having to give a cut of the profits to the taxman.

Paying no income or capital gains tax on any returns you make from your investments within an ISA means that your returns will generally be higher. This means that if you have any savings or investments you should think about making the most of your annual ISA allowance before choosing any other means.

What is an ISA?

An ISA is effectively a wrapper that protects a predetermined amount (up to £10,200 for the 2010/11 tax year) of your savings and investments from income and capital gains tax. ISAs were introduced by the government to encourage people to save.

It is important to note that an ISA is not a type of investment; it is an amount of money that you can protect from tax each year. Where you save or invest this money is up to you.

How can you use your ISA?

Most investments are allowable within an ISA; these include investment funds, structured investments, Exchange Traded Funds and passive investments. There’s also a wide range of cash ISAs and deposit based investments to choose from for any of your cash ISA allowance (up to £5,100).

Are you making the most of your ISAs?


This tax year (2010/11) you can invest up to £10,200 into an ISA, £5,100 of which may be invested into a cash ISA product. If you invest in a cash ISA any remaining allowance
can be invested in a stocks & shares ISA.

This allowance is per person (over 16 for cash ISAs/over 18 for stocks & shares ISAs), which means that a husband and wife can protect up to £20,400 for this tax year.

New ISA allowance

In last year’s Budget it was announced that going forward the ISA allowance will increase in line with RPI inflation each year.

The RPI rate of inflation in September will determine what the ISA allowance will be the following April. It was 4.6% last September, bringing the new allowance up to £10,680, or £5,340 for cash ISAs.

Invest early

The earlier you invest your ISA allowance in a tax year, the longer any returns you receive from them will be protected from income or capital gains tax, meaning your overall returns will be higher.

If you have used previous years’ ISA allowances, making the most of them will be just as important as investing this year’s allowance.

If you are not happy with the returns you are making on your existing ISA investments, you could transfer them into something new without losing the protective tax wrapper.

Ideas for your ISA

At Fair Investment Company we are dedicated to helping you to make the most of your savings and investments, bringing you research, investment opportunities and services.

Our ISA and Investment Account brings you access to a whole range of ISA investment opportunities, from leading investment managers.

Take advantage of new investment ideas including emerging markets, commodities, passive investments and Exchange Traded Funds, all within your ISA wrapper.

The tax efficiency of ISAs is based on current tax law and there is no guarantee that tax rules will stay the same in the future

The value of investments and income from them can fall as well as rise and you may not get back the full amount invested. Different types of investment carry different levels of risk and may not be suitable for all investors.

Prior to making any decision to invest, you should ensure that you are familiar with the risks associated with a particular investment.If you are in any doubt as to the suitability of a particular investment, both in respect of its objectives and its risk profile, you should seek independent financial advice.

© Fair Investment Company Ltd

 Product NameISA OptionIncome YieldMore Info
', eventAction: 'Account', eventLabel: 'Schroders Monthly High Income' });">Schroders Monthly High Income Fundyes
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The Schroder Monthly High Income Fund aims to generate a high income, whilst not compromising capital, by investing in a diversified basket of fixed income securities. 100% Discount off Initial Charges.
', eventAction: 'Account', eventLabel: 'Invesco Perpetual Monthly Income Plus' });">Invesco Perpetual Monthly Income Plus Fund ISAyes
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', eventAction: 'Apply Now', eventLabel: 'Invesco Perpetual Monthly Income Plus' });">More Info >
Popular monthly income fund that aims to achieve a high level of income whilst seeking to maximise total return through investing in high yielding corporate and Government bonds, together with UK equities. 100% discount on initial charges.
', eventAction: 'Account', eventLabel: 'Henderson Strategic Bond Fund' });">Henderson Strategic Bond Fundyes
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', eventAction: 'Apply Now', eventLabel: 'Henderson Strategic Bond Fund' });">More Info >
The aim of this fund is to deliver a quarterly income to investors by investing in higher yielding assets, which will include most types of fixed interest securities such as high yield bonds, investment grade bonds and government gilts, as well as having the ability to invest a proportion of the fund in equities. Income is paid to you quarterly.
', eventAction: 'Account', eventLabel: 'Schroders Income Maximiser' });">Schroders Income Maximiseryes
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The Schroder Income Maximiser Fund ISA aims to deliver a target income yield of 7% pa, also providing potential capital growth. Income is paid to you quarterly. 100% Discount off Initial Charges.
', eventAction: 'Account', eventLabel: 'Invesco Perpetual Corporate Bond' });">Invesco Perpetual Corporate Bond ISAyes
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', eventAction: 'Apply Now', eventLabel: 'Invesco Perpetual Corporate Bond' });">More Info >
This highly popular fund aims to achieve a high level of overall return with relative security to capital. Income Paid to you twice yearly. Up to 100% Discount off the Standard Initial Fund Charge.
', eventAction: 'Account', eventLabel: 'Artemis Income ISA' });">Artemis Income ISAyes
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', eventAction: 'Apply Now', eventLabel: 'Artemis Income ISA' });">More Info >
One of the leading UK Equity Income Funds. The Fund managers hunt out companies with strong free cash flow and solid balance sheets. Income is paid to you twice yearly. 100% Discount off the Standard Initial Fund Charge.
', eventAction: 'Account', eventLabel: 'Jupiter Corporate Bond' });">Jupiter Corporate Bond Fund ISAyes
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', eventAction: 'Apply Now', eventLabel: 'Jupiter Corporate Bond' });">More Info >
The Jupiter Corporate Bond aims to achieve a high level of income with the opportunity for capital growth, through mainly investing in fixed interest securities. Income is paid to you twice yearly. 87.5% Discount off the Standard Initial Fund Charge.
', eventAction: 'Account', eventLabel: 'invesco perpetual high income' });">Invesco Perpetual High Income Fund ISAyes
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One of the UK's most popular income fund ISAs the Invesco Perpetual High Income has delivered consistently good long term returns through a variety of market conditions. Income is paid to you twice yearly. Up to a 100% Discount off the Standard Initial Fund Charge.
', eventAction: 'Account', eventLabel: 'MandG Corporate Bond' });">M&G Corporate Bond ISAyes
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The M&G Corporate Bond Fund is a conservative ‘blue chip’ sterling fund that aims to produce a higher return than UK government bonds. Income is Paid to you Quarterly. 100% Discount off the Standard Initial Fund Charge.
', eventAction: 'Account', eventLabel: 'Jupiter Merlin Income' });">Jupiter Merlin Income Portfolioyes
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The Jupiter Merlin Income Portfolio fund aims to achieve a high and rising income with some potential for capital growth. Income Distributions are made to you quarterly. 95% Discount off the Standard Initial Fund Charge.
* See details.
†† Income payments are dependent upon the FTSE 100 Index.

The value of investments and any return from them can fall as well as rise and you may not get back the full amount invested. Please ensure that you read the Important Risk Information below.