Taking money out of ISA for current account?

newuser78

I opened a new Nationwide Flex Regular Saver (5%) late last year and so far I have transferred £500/month from an expired Nationwide Flex Regular Saver (something like 0.75%).

The old saver account is now empty and I am thinking of transferring £500/month from a Nationwide Instant ISA Saver (also 0.75%) to the Flex Regular Saver.

Should I avoid doing this in order to protect tax free status? If this makes any difference, I am on higher tax rate.

Many thanks in advance!

Dazed_and_confused

You need to weigh up the better return against possible tax liability outside the ISA.

The interest will be taxable but maybe only at a 0% tax rate.

But there can be unexpected consequences even though you may only pay 0% tax. If you are affected by the High Income Child Benefit Charge or have income over £100k that non ISA interest will still result in a higher tax bill overall even though if the interest itself is only taxed at 0%.

Google adjusted net income for more information.