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interest included or on top of allowable limits - isa.index
bs0u0128
Posts: 429 Forumite
With a direct isa, is it the case that, say after one year, you get £100
interest (for ease of this)
would that mean the following year, you could only put in £2900, or could
you put in a full £3000, to make a total of £6001 over the two years?
interest (for ease of this)
would that mean the following year, you could only put in £2900, or could
you put in a full £3000, to make a total of £6001 over the two years?
0
Comments
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£3000 is currently the maximum you can invest in a cash ISA per year. This does not take into account interest paid on previous deposits
The rules are changing as of next year, but the limits will still only apply to the maximum you can deposit each year, and will exclude interest received at the start (or end) of the tax yearI am a Chartered Financial Planner
Anything I say on the forum is for discussion purposes only and should not be construed as personal financial advice. It is vitally important to do your own research before acting on information gathered from any users on this forum.0 -
just to be clear you can save 3000 per year... any interest is in addition to that so yes next year you can save 3000 irrespective of how much interest you gained (although the amount will increase next year but that's a different story)0
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ok so just so im clear, i could save £3000 in yr 1, earn £100 interest, meaning now there is £3100 in there, i then invest yr 2s £3000, meaning £6100 tax free? or must you siphon the interest off?
after a few yrs that would soon mount up!
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Its a contribution limit. What it grows to doesnt matter.
You are able to contribute upto £7000 per year into an ISA. The income, interest or growth generated within the ISA doesnt go towards the contribution.
As soon as the new tax year starts, you are given a new £7000 allowance as it is per tax year (its actually increasing next year but I have ignored that for clarity).I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
Indeed it does! Compounding of interest is a fantastic phenomenonok so just so im clear, i could save £3000 in yr 1, earn £100 interest, meaning now there is £3100 in there, i then invest yr 2s £3000, meaning £6100 tax free? or must you siphon the interest off?
after a few yrs that would soon mount up! I am a Chartered Financial Planner
Anything I say on the forum is for discussion purposes only and should not be construed as personal financial advice. It is vitally important to do your own research before acting on information gathered from any users on this forum.0
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