Selling and rebuying inside a stocks and shares ISA?

CreditCardChris

Let's say I sold £50,000 worth of stock but kept the money in the ISA, then a few months later I decided to rebuy £50,000 worth of shares, am I locked at the £20,000 limit? So I would have to buy £20k worth in 2021, £20k worth in 2022 and then £10k worth in 2023?

Or once the money is in the ISA, that's it you can buy and sell and trade etc as long as you don't withdraw the funds?

soulsaver

CreditCardChris said:

Let's say I sold £50,000 worth of stock but kept the money in the ISA, then a few months later I decided to rebuy £50,000 worth of shares, am I locked at the £20,000 limit? So I would have to buy £20k worth in 2021, £20k worth in 2022 and then £10k worth in 2023?
NO

Or once the money is in the ISA, that's it you can buy and sell and trade etc as long as you don't withdraw the funds?
Yes

..................

jimjames

CreditCardChris said:

Or once the money is in the ISA, that's it you can buy and sell and trade etc as long as you don't withdraw the funds?

That is the huge benefit of ISAs, once the money is inside it is entirely tax free. It can grow and produce income and no tax is due on either. Some ISAs have over £1 million of investments in them and everything is tax free which is great for the holder, not so great for the Treasury for collecting tax.

Langtang

jimjames said:

...Some ISAs have over £1 million of investments in them and everything is tax free which is great for the holder, not so great for the Treasury for collecting tax.

Stupid question alert!
How does that sit with the £85k banking rules?

Alexland

Langtang said:

How does that sit with the £85k banking rules?

FSCS protect up to £85k in a bank or regulated investment account (although the investment assets you purchase are ultimately unprotected) however the assets are safer in an investment account as, unlike a bank, the investment platform is required to segregate client assets from their own money. Still there is always the risk of fraud or error which if beyond the platform's ability to compensate you could result in a loss.

I would hope that those that have built up £1m+ in S&S ISAs are using at least a couple of unrelated platforms and fund managers to spread their risk and increase the proportion that is FSCS protected.

Albermarle

Langtang said:

jimjames said:

...Some ISAs have over £1 million of investments in them and everything is tax free which is great for the holder, not so great for the Treasury for collecting tax.

Stupid question alert!
How does that sit with the £85k banking rules?

A S& S ISA is not a bank for a start .
Banks go bust ( or have to be rescued) usually because they lend too much money to risky borrowers, who can't pay them back . It is a totally different scenario. 

Langtang

Albermarle said:

Langtang said:
Stupid question alert!

How does that sit with the £85k banking rules?

A S& S ISA is not a bank for a start

Thanks for your replies. Perhaps I'm missing something: Does that mean that if I buy a S&S ISA through a bank, say HBOS, that it can have as much in in as I like and is exempt from the £85k rule?

grumiofoundation

Langtang said:

Albermarle said:

Langtang said:
Stupid question alert!

How does that sit with the £85k banking rules?

A S& S ISA is not a bank for a start

Thanks for your replies. Perhaps I'm missing something: Does that mean that if I buy a S&S ISA through a bank, say HBOS, that it can have as much in in as I like and is exempt from the £85k rule?

What is the 85k rule? 

The 85k figure is what is protected by the FSCS in the event the institution goes busy and cannot pay you back your money. 

Edit: Bust!!!

eskbanker

grumiofoundation said:
The 85k figure is what is protected by the FSCS in the event the institution goes busy and cannot pay you back your money.

FSCS protection is more likely to come into play when the institution ceases to be busy enough....

Langtang

grumiofoundation said:

Langtang said:

Albermarle said:

Langtang said:
Stupid question alert!

How does that sit with the £85k banking rules?

A S& S ISA is not a bank for a start

Thanks for your replies. Perhaps I'm missing something: Does that mean that if I buy a S&S ISA through a bank, say HBOS, that it can have as much in in as I like and is exempt from the £85k rule?

What is the 85k rule? 

The 85k figure is what is protected by the FSCS in the event the institution goes busy and cannot pay you back your money. 

Be gentle, I'm kinda new at this...
So, if I have 85k in an ISA and 85k in a S&S ISA with the same bank, are they both protected? I assume that the shares are not lost if bank goes bust. Am I correct?

Alexland

Langtang said:

So, if I have 85k in an ISA and 85k in a S&S ISA with the same bank, are they both protected? I assume that the shares are not lost if bank goes bust. Am I correct?

The accounts are only protected up to a combined £85k but provided there has been no fraud or error on the investment account the shares should be in a segregated client nominee account and the FSCS would only need to cover the lost cash in the bank account. Of course if the investment account held shares in the bank that just went bust that would be lost too!