UTF-8 is a multibyte encoding that can represent any Unicode character. ISO 8859-1 is a single-byte encoding that can represent the first 256 Unicode characters. Both encode ASCII exactly the same way.
ISO-8859-1 is a legacy standards from back in 1980s. It can only represent 256 characters so only suitable for some languages in western world. Even for many supported languages, some characters are missing. If you create a text file in this encoding and try copy/paste some Chinese characters, you will see weird results. So in other words, don’t use it. Unicode has taken over the world and UTF-8 is pretty much the standards these days unless you have some legacy reasons (like HTTP headers which needs to compatible with everything).