BED & ISA - Is this possible?

Savings_Dave

I've been looking at the fall in the stock markets recently and would like to add some investment before it goes north again (don't want to wait till 6th April). I have already subscribed my full ISA allowance for this year and have money aside for the 2011-2012 tax year.

I am aware I would need to sell the funds first (convert to cash) then re-invest by buying back the funds on the same day. Should I do this transaction in this tax year or only on or after the 6th April? I have seen them mention this on their website, but the deadline is 4th April which makes me think that's only for new money for the current tax year. I don't want to accidently oversubscribe.

Any comments would be helpful, thanks.

Mikeyorks

You buy them now .... into the unused Funds account. You sell them before 5th April (some take 2 days .. so be careful). You ring HL after 5th April and get them to move the resultant cash into the ISA account. You then re-purchase.

As you're doing so in the ISA - you can buy exactly the same funds if you wish. You couldn't do that if selling to use your CGT allowance and repurchasing within the Funds account .... as you need to wait 30 days - or buy different funds.

Mikeyorks

Sorry - was in a hurry to close down last night.

If you haven't used any of your CGT allowance this year then the preference has to be to sell just this side of 5/4? You never know - despite existing market conditions - there may be profit! And then you have to move the funds across (max £10680) to the ISA immediately after 5/4. As soon as that's done you just complete re-purchase instructions via online.

But if you want to take the sale to the wire then it's adviseable to give them a ring and confirm dates? One or two of my funds take a full 2 working days to sell. And one or two 'boutique' funds (where they go through other market makers eg Junior Oils) can take a bit longer before you see the result.

If you're not desperate to use any of the years CGT ..... then you can equally leave the sale/purchase until after 6/4 ..... when things will have quietened a bit. I'm doing that out of necessity as I'm out of the UK the whole of April. And 'gains' have been a bit sparse this year ..... so I switched a few funds between my own / wife's portfolios, a few weeks ago, in order just to chew a few small holes out of the allowance.