ISA safeguards

SirGodfreySirGodfrey Forumite
1 Post
MoneySaving Newbie

I’ve searched the MSE website in vain to find an answer to my query.

 I believe the ISA annual allowances are carried over from year to year so, bearing in mind that I have multiple current and regular savings accounts earning up to 3% (for now), if I pay 20K into a flexible ISA in March and then withdraw it in April does that work? Could I then pay in 40K the following March and withdraw again in the following tax year and so on?

Regards

 Steve Sellars


Replies

  • eskbankereskbanker Forumite
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    ISA annual allowances aren't carried over from year to year as such, in that the amount of new money that can be paid into ISAs each tax year is £20K on a 'use it or lose it' basis, but flexible ISAs allow you to withdraw as much as you like and return it to the ISA within the same tax year.

    So yes, if you have £20K in a flexible ISA as you go from 2020/21 into 2021/22 then you can withdraw that and replenish it by the end of 2021/22 together with another £20K contribution of new money, giving you £40K in the ISA at the time of moving from 2021/22 to 2022/23, which can be withdrawn again once into the new year and so on.

    https://www.moneysavingexpert.com/savings/flexible-isas/
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