ISA Dividend Reinvestment

andy_pandy_32

Hi
This is my first post and i am hoping somebody can help.
Towards the end of last year i put the maximum amount of shares i could up to my £15,000 ISA limit that matured from a company share-save scheme into an IWeb stocks and shares ISA, I have now received a dividend on these shares and it is being held as cash within the ISA at present.
My question is do i have to reinvest in the same shares that i received the dividend on or can i reinvest this cash into different company's shares or fund considering i have used up my 2014-2015 ISA limit

Porcupine

The dividend will have been paid inside the ISA so it's now ISA money. You can do whatever you like with it - buy new shares/funds, buy more of the same shares, withdraw it. There's no problem with the ISA limits - that's the point of owning shares in an ISA, for the dividends and tax-free growth they provide you!

Biggles

As porcupine says, ISA limits are only a limit on what you put into the ISA each year. Anything earned within the ISA can be used as you wish.

TCA

andy_pandy_32 wrote: »

My question is do i have to reinvest in the same shares that i received the dividend on or can i reinvest this cash into different company's shares or fund considering i have used up my 2014-2015 ISA limit

With iWeb, if you like, you can set your ISA account to automatically reinvest dividends in the same company shares. There's a small saving to be made by doing this on smaller dividends - charges are 2% of the dividend payment, maximum the usual £5 fee. You can set dividend reinvestment on and off as you want depending on your choice for the next dividend due.

skitskut

Following on from this post...
If I have the accumulation version of a fund does any dividend reinvestment charge (e.g. iWeb 2% of the dividend payment) come into effect?
Or with the ACC version are dividends automatically reinvested by the fund and so nothing to do with the platform?

jimjames

The whole point of ACC units is that dividends are reinvested in the fund directly without you seeing them so no need to worry about extra charges for reinvestment.

Eco_Miser

skitskut wrote: »

Or with the ACC version are dividends automatically reinvested by the fund and so nothing to do with the platform?

That's often said, but in reality, the dividends stay invested in the fund, making the unit price higher than the INC version, which pays out.

Nothing to do with the platform, either way you look at it.