Two Flexible Cash ISAs - Can I withdraw and replace Cash

ninja_byron

I have two cash ISA’s, one opened last financial year, and one opened this financial year

Both have maximum in for year

Both are “Flexible”

Can I withdraw cash from the “Previous Years ISA” this financial year, and put it back in before end of this financial year

Any help appreciated

eskbanker

Yes, you can access money from either.

Farway

eskbanker said:

Yes, you can access money from either.

BUT, you cannot pay it back in as OP asked

Once withdrawn as cash, it loses its tax-free status and that cannot be recovered

You could withdraw in cash from previous ISA and pay it back in this year's ISA f you had not reached the limit of new money & the supplier allows top-ups

Perhaps if you tell us what you want to achieve, someone here may have more precise answers

Expotter

According to current Flexible ISA rules,

"Withdrawals of current year subscriptions, can effectively be replaced in any current year ISA, but cannot breach the ‘one ISA of each type per tax year’ rule."

"Replacement of flexible ISA previous year funds must be made to the account from which the withdrawal was made, and in the same tax year."

So, if I understand correctly, you can withdraw from both ISAs and later pay it back in, as long as it's in the same tax year and for previous years subscriptions, it has to be paid into the same account.

Source:
 https://www.gov.uk/guidance/manage-isa-subscriptions-for-your-investors#flexible-isas

ninja_byron

Thanks all, that's how I understood it as well, but kept second guessing myself. 
Scenario is (all in this FY):
both isa's are "flexible"
1.   May 23 - I took some cash from an existing Cash ISA (no money put in this FY yet)
2.   Aug 23 - I opened a new Cash ISA due to poor rates of old one, and put the maximum in for this year.
3.   Mar 24 - I got a notification from my old Cash ISA provider that I could repay what I had taken out as long as it was in this FY (on top of my £20,000 allowance for the year - which I have already used up with new ISA).

eskbanker

Farway said:

eskbanker said:

Yes, you can access money from either.

BUT, you cannot pay it back in as OP asked

Once withdrawn as cash, it loses its tax-free status and that cannot be recovered

You could withdraw in cash from previous ISA and pay it back in this year's ISA f you had not reached the limit of new money & the supplier allows top-ups

Your post would be correct if the ISAs concerned weren't flexible ones.

But they are....

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

ninja_byron

I eventually spoke to a Human at my Bank and he confirmed that my product was a "Flexible Cash ISA" and basically you can withdraw and deposit back from a specific account as long as the amount at the start of year and end of year is same. So if you took out for example £500 in May, you can put it back before end of Financial Year. 

surreysaver

Farway said:

eskbanker said:

Yes, you can access money from either.

BUT, you cannot pay it back in as OP asked

Once withdrawn as cash, it loses its tax-free status and that cannot be recovered

You could withdraw in cash from previous ISA and pay it back in this year's ISA f you had not reached the limit of new money & the supplier allows top-ups

Perhaps if you tell us what you want to achieve, someone here may have more precise answers

You can pay it back in, as long as the money gets paid back to the same account, and within the same tax year.

I believe you may be confusing the rules with non-flexible ISAs