An ISA – or Individual Savings Account – is a ‘tax-efficient’ way of investing your own money. In practice, this means any growth, returns or interest you earn on savings up to your annual ISA allowance (£20,000) are tax-free.
Currently, there are six main types of ISAs: Cash ISA, stocks and shares ISA, Lifetime ISA, Help to Buy ISA (closed to new accounts), Innovative Finance ISA and Junior ISA. At Nutmeg, we offer a stocks and shares ISA, a Lifetime ISA (LISA) and a Junior ISA (JISA).
Creating multiple pots
When you set up a stocks and shares ISA with Nutmeg, we apply the ISA wrapper to all your pots. You can allocate each pot to an individual investment goal, be it a child’s education, a home purchase or a rainy-day fund. You can also choose whatever risk level and investment style is appropriate for each.
Any contributions you make to one or more of your pots counts towards your annual ISA allowance (£20,000). Creating multiple pots does not mean you can ringfence one of your pots as "ISA" and "non-ISA". Should you exceed this amount, any excess will be held in a Nutmeg general investment account, which is subject to taxation.
Please note that you may only create multiple pots for a Nutmeg stocks and shares ISA. The LISA annual allowance is only £4,000, although it is included within your total ISA allowance, whereas the JISA allowance of £4,368 is completely separate. You can still choose whatever risk level and investment style you like for a Nutmeg LISA or JISA, but you may only create one pot.
You’ll find more information specific to the LISA and JISA on our support pages.
Setting your ISA limit
As part of the ISA set up process, we ask you to set your own custom ISA limit. This limit should also take into account the amount you have paid into (or plan to pay into) an ISA held elsewhere during this financial year. We'll automatically count every contribution towards your ISA allowance until you reach the £20,000 threshold, or the custom limit you’ve set, and anything above this will be held in a Nutmeg general investment account.
Know that if you have multiple stocks & shares ISAs, you may only pay into one per tax year. You are, however, allowed to pay into one stocks and shares and one cash ISA.
If you have additional questions about the ISA allowance, or questions on how to customise your allowance, we recommend this support article.
Total value of your ISA
Looking at your Nutmeg dashboard, along the left-hand side the “Your ISA” box will show you the total value of your ISA. This includes all previous years you have contributed to your ISA with us, any ISAs you have transferred to us from another provider, and any gains or losses you’ve seen during your time with us.
For more information on how we calculate returns, we have a support article dedicated entirely to that subject.
Viewing your ISA contributions
To see how much you’ve contributed for each tax year with Nutmeg, click “View ISA allowance” on the left-hand side of you dashboard and choose a tax year from the drop down menu beside your current tax year contributions. Doing so means you can see how much you’ve contributed towards your ISA allowance in whichever year you specify.
Withdrawing from an ISA
If you do hold an ISA and a general investment account (GIA), we'll first sell any investments that are not in your ISA. This means that you won't lose a portion of your ISA allowance unnecessarily.
Auto renewing your ISA
Under HRMC rules, if you do not contribute to your ISA within a tax year, your ISA will lapse. This means an ISA will not be automatically opened for you in the following tax year. You will need to log in to your Nutmeg account and start the ISA if it has lapsed
With a Nutmeg stocks and shares ISA, we give you the option to auto-renew your ISA for the next tax year so that you’re set up to accept contributions. We also give you the option to ‘auto-refill’, meaning any taxable investments from your general investment account will be automatically moved to an ISA wrapper, allowances permitting.
You can find out more about our ‘auto renew’ and ‘auto refill’ settings on the relevant support page.