Multiple Large Sums Into ISA

colsten

HazyKid said:

I was amazed at the response I got to my post.
Thank you all for your input.
I've come across another thing that puzzles me, and I wonder if anyone knows the answer.
If I use my whole 20K allowance in a S+S ISA that pays dividends, am I allowed to pay those dividends back into the ISA as a tax free investment? Everything I read tells me that it should be possible, but surely it would break the threshold for the ISA?

Any dividends for your ISA investments get paid into the ISA, so you couldn't "pay them back in". Unless you first withdraw them - which would be a silly thing to do if you want to re-invest them.

Dividends do not count as contributions. You can re-invest them, in addition to your max £20k annual ISA allowance.

Dividends paid into an ISA are also completely tax-free, and do not count towards your dividend allowance.

HazyKid

Thank you all. That makes a lot more sense now.