Withdrawing from a full ISA

Milarky

Back in the days of TESSAs you could do something you can't do with ISAs today, and that was close the one you had and open another one striaghtaway without needing to wait for the next tax to receive your 'annual allowance'. Interest was paid gross up to closure - but you were then limited to £3000 and lesser amounts on subsequent anniversaries.

[Still it meant anyone could keep £3000 of tax free savings rolling along and still have an emergency fund.]

bigadaj

Bravehearted wrote: »

My point is this: the essence of a cash ISA is to save up to 5640 and have the interest untaxed.

Why should it matter if withdraw then replace any of it?

I'm a bit unhappy to be honest. I had filled the ISA some time ago and because my other easy access savings account takes 3 days to make a withdrawal this time of year, I've had to withdraw 3k from the ISA. And of course I can't refill that 3k when I get it back on Friday.

So when it matures, I'll earn 4% on the remaining 2640 instead of 5640. Sorry about ranting, I should be thankful rather than sulking, others have it worse.

Might sound harsh but that is purely down to your lack of planning. In such circumstances then the easy savings access should cover things, if its that unexpected then it's an emergency and the minimal loss of interest pales into insignificance. The money can obviously go back in next April anyway, the loss is only a few pounds a year so not worth worrying about.