Do I pay tax on monthly ISA interest

zacaz00m

Hi All

Hoping someone is able to answer my question. I took out a cash ISA last year and receive interest payments monthly into a current account. My assumption was that this is Tax free because the interest has come from an ISA. After googling this that still seems the case but earlier today I was about to open another cash ISA for this year with Shawbrook. I filled in all of my details and then it came to the part where I enter my current account details , so again I can receive the payments monthly , but here was a message on there that said something like you will be taxed if you move the interest from the main ISA holding account. I did speak to Shawbrook and they confirmed that this was not the case and because it is an ISA I shouldn't pay Tax on the amount that will be payed into my current account monthly.
I realise I would be paying tax on a normal fixed if over £1000 or £500 depending the tax bracket. But does anyone know if I have to pay tax on my ISA in this scenario please ?

eskbanker

The monthly ISA interest paid by your ISA provider isn't taxed, in that it doesn't count as taxable income as far as HMRC are concerned.

However, once you've removed it from the ISA wrapper then anything subsequently earned from it, such as interest paid on the current account by your bank, is taxable, albeit at 0% if within your personal savings allowance....

zacaz00m

Thank you very much , that’s good to know.
appreciated.