Should interest remain in ISA?

Newbie2saving

Hi,

I think I already know the answer to this, but thought I would ask all you experts! Is it best to leave the interest earnt on an ISA within that account rather than having it paid into your link account? Seems to make sense to leave it their to accumulate tax free...? Is that logic correct?

Thanks...

McKneff

That is absolutely correct.
Put it somewhere else, you will probably spend it and/or you will pay another tax on the interest of the interest.:eek:

Newbie2saving

I better get the HSBC to cancel it going into my current account then! I have only started thinking about this since getting the transfer form, thanks.

ses6jwg

Some people require the interest to live off e.g. pensioners with a large amount of savings

However for most people its a better option to compound it.