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ISA Guide

Your guide to simple, tax-efficient savings

Our guide will help you to understand how you can save and invest tax-efficiently with an ISA.

The value of stocks and shares investments and the income from them can fall as well as rise, and you may not get back the full amount you invest. Any tax treatment and/or reliefs referred to are those applying under current legislation, which may change, and their availability will depend on your individual circumstances. The favourable tax treatment of ISAs may not be maintained.

Most normal savings accounts and investments are taxed so the tax man gets some of your interest, or investment growth.

Individual Savings Accounts (ISAs) are different, because you don't pay tax on the interest on savings or the capital gains on investments. An ISA is simply a way of preventing too much of your money from going to the tax man and giving your finances a real boost.

There are two types of ISA a Cash ISA and a Stocks and Shares ISA.

The government does limit how much you can put in an ISA each tax year, for this tax year 2013/2014 up to 11,520 can be invested in a stocks and shares ISA which can include up to 5,940 in a cash ISA.

Whether you like saving in cash, stocks and shares or a combination of both, there's an ISA out there for you. However if you don't use your ISA allowance in each tax year, you will lose it.

A cash ISA is a lot like a regular savings account - except you don't pay any tax on your interest.

How much can you save?

In the current tax year, you can put a maximum of 5,760 into a cash ISA.

Moving your cash ISA

If you have a cash ISA with another bank or building society, you can complete a transfer application form and we will transfer this to another cash ISA with RBS, when you transfer the funds; you keep all the tax benefits.

However, if you withdraw money from a cash ISA you will lose the tax benefits on the funds you’ve withdrawn. The only way you could reinvest into a cash ISA is to take advantage of any remaining cash ISA allowance from that tax year that you have not used.

Our stocks and shares ISAs give you the potential for higher levels of growth than cash ISAs.

However, remember that the value of stocks and shares and the income from them can fall as well as rise and you may not get back the full amount of your original investment.

Investing for the medium-to-long term

A stocks and shares ISA is designed to give you a tax-efficient return over years, not months. So although you can access your money at any time, you should consider this a medium to longer term investment for five years or more.

How much can you invest?

The most you can put into a stocks and shares ISA this tax year is up to 11,520.

If you have put money into a cash ISA during the current tax year then the most you can invest in a stocks and shares ISA is your annual limit minus the sum you've put into your cash ISA.

A choice of investments

We offer a range of investments that can be invested into your stocks and shares ISA, some with advice and some that you can select without any advice.

Our investments provide you access to a wide range of assets, including shares, government securities, corporate bonds, tracker funds and structured products.

Q. Who can have a cash ISA?

A. Anyone who is resident in the UK, as well as being 16 or over can have a cash ISA. For a stocks and shares ISA, you need to be 18 or over.

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Q. How much can I put in an ISA?

A. At the moment, up to 11,520 a year in an ISA, subject to certain criteria.

You can invest up to 5,760 in a cash ISA, plus put the remainder into a stocks and shares ISA (minimum investment may apply).

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Q. How many ISAs can I have?

A. You can only have one cash ISA and one stocks and shares ISA per tax year.

If you already have a cash ISA with another provider you can choose to transfer your cash ISA to RBS.

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Q. When does the tax year start and finish?

A. The tax year runs from 6 April until 5 April the following year.

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