Account types

Investment pot

Your Investment pot can be an ISA, which is a tax-free savings account, where you won’t pay any tax on the money you make within it (which can be a big saving over time).

You can save up to £20,000 per tax year (April 6th to April 5th the following year).

If this limit is reached, or you don’t want to save within an ISA, an Investment pot (non-ISA), technically called general investment account (GIA) can be used. This doesn’t have any tax-free benefits (more on this below).

Withdrawing money takes around a week.

Pension pot (25% bonus)

A pension pot is for saving towards retirement.

Every time you add money, you’ll get a 25% bonus added automatically (this usually arrives at the end of the following month).

We call this a bonus as it’s like free money from the government. It’s actually tax relief, and is to refund tax you’ve paid (or will pay) on your income.

If you pay 40% or 45% tax, you can claim more back via a Self Assessment tax return or directly from HMRC (we can help point you in the right direction).

As an extra bonus, you also won’t pay any tax as your money grows, so it can grow much larger over time.

Each tax year, you’ll be able to save up to your yearly taxable income (with a maximum of £60,000 per year).

You may pay tax when you start withdrawing it, although 25% is typically tax-free (up to £268,275). How much you’ll actually pay depends on your income, circumstances and tax rules at the time.

These are the general rules, however your personal circumstances may mean different rules for you, and may change in the future.

Investment pot (non-ISA)

You can use this account as an alternative to an ISA. Or, in addition to, if you’ve reached your yearly limits on your ISA and pension.

There’s no tax-efficient saving benefits, so you might have to pay tax on the money you make.

Note: the government could change these tax or any other rules in the future, and your overall tax treatment will depend on your individual circumstances.