Thicko ISA question

gavinm79

I know there is a limit as to how much you can put in an ISA p.a. Is it the case that if you put the max amount in an ISA every year - the ENTIRE amount always pays tax-free interest?

So someone who has put £3600 in a cash ISA in each of the past 10 years now has £36000 (ex accumulated interest),all of which pays out interest tax-free? Or do you just get the tax free benefit on £3600 only each year?

Sorry for my ignorance.

Lokolo

gavinm79 wrote: »

I know there is a limit as to how much you can put in an ISA p.a. Is it the case that if you put the max amount in an ISA every year - the ENTIRE amount always pays tax-free interest?

So someone who has put £3600 in a cash ISA in each of the past 10 years now has £36000 (ex accumulated interest),all of which pays out interest tax-free? Or do you just get the tax free benefit on £3600 only each year?

Sorry for my ignorance.

The bold is correct.

gavinm79

cheers lokolo - i need to get an ISA!

chris_m

Indeed - but it won't take you ten years to get £36K in one now. After April 6th you can put £5100 in a cash ISA per year, increasing each year by RPI according to Darling's statement yesterday.