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High-income funds for your Isa

We find the best options for fund investors seeking to generate tax-free income from their Isa

One of the most attractive features of individual savings accounts (Isas) is that investors can draw an income from them free of tax. We go in search of the best high-income funds and find plenty of opportunities for investors, as long as you avoid a few common pitfalls.

Equity income funds are usually the first port of call for Isa investors looking for income. The average 12-month yield for the IMA UK Equity Income sector is 4.21 per cent, but the sector includes some enhanced equity income funds, with a significantly higher yield. We include two of these in our IC Top 100 Funds: Fidelity Enhanced Income (GB00B3KB7799), which has a 12-month yield of 5.9 per cent, and Schroder Income Maximiser (GB00B0HWHK75), which has a 12-month yield of 6.7 per cent.

Read our tip on Fidelity Enhanced Income

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