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So why do people use ISAs in the first place? One reason is tax efficiency. Under current UK rules, investment growth and income inside an ISA are not subject to capital gains tax or dividend tax. Another is simplicity. Holding investments inside an ISA can reduce the amount of tax reporting required compared to investing outside one. For those investing over longer periods, ISAs can also support compounding, meaning returns are reinvested without being reduced by ongoing taxation. While outcome

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