What is an ISA?

Definition of ISA

An ISA is an Individual Savings Account. The money that sits in that ISA will earn interest and dividends free of tax.

If you're a UK resident, you can invest money in an ISA each year, up to a certain limit (this changes every year).

Interest and dividends paid on money that's in an ISA aren't reported on your UK tax return, because they are tax-free.

You can also invest money in an ISA on behalf of a child.

FreeAgent's Chief Accountant Emily Coltman is available to answer your questions in the comments.

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