ISA maturing can I reinvest

Redbidet

New to this so please be gentle. I took out a 1 year cash ISA on 22 Feb 2024. This is maturing this February on 22nd Feb 2025. Was the tax free interest for the tax year 23 to 24 or is it for this tax year ie 24 to 25.? Just trying to clarify if I can reinvest in an ISA this tax year or do I have to wait till next tax year ie 25 to 26. It will be for the max amount £20000. Thank you  

eskbanker

Redbidet said:

New to this so please be gentle. I took out a 1 year cash ISA on 22 Feb 2024. This is maturing this February on 22nd Feb 2025. Was the tax free interest for the tax year 23 to 24 or is it for this tax year ie 24 to 25.? Just trying to clarify if I can reinvest in an ISA this tax year or do I have to wait till next tax year ie 25 to 26. It will be for the max amount £20000. Thank you  

If the interest is added on maturity then it's for 2024/25, but as it's within an ISA there is no tax implication anyway so it doesn't matter.

Likewise, the addition of interest doesn't affect your ability to transfer it to another ISA in any way.

Redbidet

Thanks ,the interest is added monthly  since Feb 24 .Still confused, When it matures in 2 weeks time can I then open another ISA ,perhaps with the same provider perhaps not or have I already used up my ISA allowance for the tax year 24/25

kempiejon

Redbidet said:

Thanks ,the interest is added monthly  since Feb 24 .Still confused, When it matures in 2 weeks time can I then open another ISA ,perhaps with the same provider perhaps not or have I already used up my ISA allowance for the tax year 24/25

If I have understood this right you opened that ISA in Feb 2024 for the 23/24 tax year, since April 2024 you have been abe to open another ISA and come April 2025 you'll be abale to open yet another. It's £20k ISA per tax year (6th April - 5th April)

molerat

Your allowance is purely for new money.  If you have not put any money into an ISA since April 2024 then you still have your 24/25 allowance available, the interest added to your ISA does not count. Money already within an ISA does not count so you must transfer it by opening a new ISA and getting them to pull the money in.  You must not withdraw it and move it to a new ISA yourself as if you withdraw it from the tax free environment it will become "new money".  So from what you say you can open an ISA and transfer this account to it and open another ISA and put £20K into it all before April when you will then be able to open another with another £20K.

FrugaiMacDugal

Yes, you will probably get options with your existing provider, but if you want to transfer to a new provider you must get them to initiate transfer to avoid losing ISA status.

maman

As has been said, the money (including interest) that's already in your ISA doesn't count in your 2024 - 2025 allowance. So unless you added extra funds to it (interest doesn't count) since you opened it then you still have this year's allowance of £20K.

Take a look around and decide which product you want for when your current ISA matures. I'd do this PDQ otherwise your current provider will probably put it into a low interest ISA product. That won't matter longer term as you can transfer whenever you want but it's best to get it into the best value new ISA quickly to prevent losing interest.

When your new ISA is opened, the new provider will request your money from your existing one. Then you have until 6th April to add up to £20K from this year's allowance. After 6th April you could add up to another £20K, provided the Chancellor doesn't change the rules.

If you decide to stay with your current provider then you just tell them the new product you want from what they're offering and they'll do the rest. 

I'm assuming you've already had notice of maturity from your existing provider. If you haven't then contact them as the date is imminent. You can shop around and open a new ISA now, you don't have to wait. You simply put the maturity date on your application and they'll action it at the right time. 

Albermarle

Redbidet said:

New to this so please be gentle. I took out a 1 year cash ISA on 22 Feb 2024. This is maturing this February on 22nd Feb 2025. Was the tax free interest for the tax year 23 to 24 or is it for this tax year ie 24 to 25.? Just trying to clarify if I can reinvest in an ISA this tax year or do I have to wait till next tax year ie 25 to 26. It will be for the max amount £20000. Thank you  

I suggest sitting down for an hour and read through the forum, and then you will be better informed and feel less new to ISA rules,