Help on Transferring ISA

Buddlia

I`m after moving a cash ISA sum of around £8000 as the rate has gone down to 0.75%. At the moment I don`t pay tax so was hoping to re invest in a fixed term Bond or something else that will have a better rate.
When I tried to move the money it said that if you are transferring this money to an account which is not a Cash ISA you will lose the tax-free status on the money you transfer.
Does this mean I could only invest £5,640 of it in a new ISA if I did choose to go for a new ISA?

Thanks for any information.

eskbanker

If you want to put the money into another ISA, open the new ISA and use the new provider's transfer process to bring all the funds over without losing their tax-free status.

If you don't want to keep it tax-free you can withdraw it and do what you want with it!

Buddlia

eskbanker wrote: »

If you want to put the money into another ISA, open the new ISA and use the new provider's transfer process to bring all the funds over without losing their tax-free status.

If you don't want to keep it tax-free you can withdraw it and do what you want with it!

Thanks eskbanker, That`s what I hoped, I`m not really used to ISA`s and the tax free status threw me, I was not sure if I would lose some of the Interest it had gained if I just withdrew it.

latecomer

Make sure your new ISA is one that accepts transfers as not all do.

ashnojutsu

If I have previous years' ISA's and transfer them into a new ISA this year, does that count as my ISA allowance for this year? Or could I open another ISA on top of transferring my old ISA this year?

Archi_Bald

Transfers do not count towards the annual allowance. Neither does interest.