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Isa
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Posts: 2,104 Forumite
I am over 18 but do not pay tax. Can i open an ISA account. IS that better than a normal savings account?
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ISA's are generally better for taxpayers, but there's certainly nothing stopping you from opening one as a non taxpayer. If you're likely to pay tax during the life of the account, it certainly might be worth your while putting money into a cash ISA now.I am over 18 but do not pay tax. Can i open an ISA account. IS that better than a normal savings account?I am a Chartered Financial Planner
Anything I say on the forum is for discussion purposes only and should not be construed as personal financial advice. It is vitally important to do your own research before acting on information gathered from any users on this forum.0 -
ISA's are generally better for taxpayers, but there's certainly nothing stopping you from opening one as a non taxpayer. If you're likely to pay tax during the life of the account, it certainly might be worth your while putting money into a cash ISA now.
Why is that better than a normal savings account for a non-tax payer?0 -
An ISA is better than a savings account because if/when you do start paying tax in the future, the £3000 you've saved in an ISA each year will remain tax free.
I opened ISAs as a student (when I didn't pay tax), which I still have now, so rather than paying tax on all my savings accounts, my ISAs are still tax free so I get a better return on my money.Comping Challenge: 2 x CDs £30, Outlet Shopping Vouchers £50
TopCashback: £59
Weightwatchers: aiming to lose 1.5 stone
Want to join topcashback? Let me refer you!!!0 -
On a normal savings account, a basic rate taxpayer pays 20% income trax on any interest, and a higher rate taxpayer pays 40%. In an ISA these taxes do not apply. As such, the net return you get out of an ISA is better for a similar interest rate normal account.Why is that better than a normal savings account for a non-tax payer?I am a Chartered Financial Planner
Anything I say on the forum is for discussion purposes only and should not be construed as personal financial advice. It is vitally important to do your own research before acting on information gathered from any users on this forum.0
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