self select ISA

cube101

Hello,
I'm looking at opening a mini self select (equity) ISA. I currently have a index tracking ISA that i am paying into monthly and want to know if i can transfer this to the self select ISA to purchase shares or would i have to wait until next April and the new tax year?
Also can some one tell me how the self select ISAs work?
Do i just fund the account with upto 4K then buy and sell shares with in this and any profits are treated like interest would would be in a cash ISA? Can any losses be offset and more capital added to the ISA?

Many thanks,
Steve

cheerfulcat

cube101 wrote: »

Hello,
I'm looking at opening a mini self select (equity) ISA. I currently have a index tracking ISA that i am paying into monthly and want to know if i can transfer this to the self select ISA to purchase shares

Yes, you can transfer at any time.

Also can some one tell me how the self select ISAs work?
Do i just fund the account with upto 4K then buy and sell shares with in this

That's right, except that the limit for stocks and shares ISAs is £7000 if you don't have a current cash ISA.

and any profits are treated like interest would would be in a cash ISA?

Yes. Tax-free.

Can any losses be offset and more capital added to the ISA?

No; that's the big drawback of ISAs and a good reason to be very careful of what you put in them.

cube101

thanks for the reply!

jamesd

Worth noting that while you can hold cash in a stocks and shares ISA for future investment (including selling and holding cash if you don't like the look of the markets), that interest is taxable.

You can put the money in at any time in any amount up to the annual limit. How much the minimum value is for lump sum purchases are depends on the provider; with Hargreaves Lansdown the online system has a minimum of 1000 but the phone service and buying after selling as part of a switch don't have that limit. Regular investing each month instead of lump sum investing is also available.

sand2880

Interest is paid tax free, dividends are taxed at 10% within ISA's, can't reclaim even if non tax payer.

What counts is how much you put in, £7k max, if this loses value up cannot top it back up.

cheerfulcat

Interest on cash in S&S ISAs is not tax-free.

jamesd

Interest is not tax free in a stocks and shares ISA, only in a cash ISA.

dunstonh

corporate bonds/fixed interest held in ISAs are tax free as well. They can still claim the tax back (as can non taxpayers on unit trusts held unwrapped)

jamesd

For anyone following along, the distinction is between cash in the outermost wrap ISA account itself (not invested yet) that is taxed, while interest from investments that pay it is not taxed.