Cashing out ISA to manually transfer

Publius

I have a stocks and share ISA with HSBC global investor with about £5k in it. Nothing put in this tax year.

I want to transfer to new AJ Bell ISA. The last time I did a transfer (Vanguard to HSBC) it took 5 weeks and I figure with covid there's a good chance it could take longer this time and I really don't want to be chasing people up.

The question is this, I don't plan to put more than £4k into the ISA this year. If I cash out my existing ISA and do a manual cash transfer of funds, what tax do I lose?

As far as I can figure the growth (capital gains) of the stocks in the ISA is covered so I won't suddenly become liable for that.

So long as the £ to be transferred and invested are low (<£20k), doing a transfer manually seems no real disadvantage to me?

What am I missing here?

Alter_ego

You would not be transferring if you do that. You would be starting a new ISA.

Publius

Alter_ego said:

You would not be transferring if you do that. You would be starting a new ISA.

Indeed, but is there downside if the numbers involved are under £20k?

badger09

Publius said:

Alter_ego said:

You would not be transferring if you do that. You would be starting a new ISA.

Indeed, but is there downside if the numbers involved are under £20k?

No downside.  You won't lose anything apart from the opportunity to invest whatever is in HSBC ISA in addition to this year's ISA allowance. 

ColdIron

You would be out of the market for several days but there are no tax consequences for you going this route. For small sums below the annual contribution allowance it may make sense for you as long as you accept any market movements which could work for or against you