Change to the Flexible ISA Regulation (5DDB) dated 15 July 2025

slinger2

I notice that there's been a change to the Flexible ISA Regulation (5DDB) dated 15 July 2025. See: https://www.legislation.gov.uk/uksi/2025/733/regulation/5/made

The main effect of this is to change paragraph (3). From April 2024 this said:

"(3) Any replacement subscription may be made only to the account from which the withdrawal of a cash amount it is replacing was made."

but now says:

"(3)  Any replacement of a previous years’ subscription may be made only to the account from which the withdrawal of a cash amount it is replacing was made.

(3A) Any replacement subscription that is not deemed to be a replacement of a previous years’ subscription is to be treated as a subscription to an account as specified in regulation 4ZA (subscriptions to an account other than a junior ISA account).”

Paragraph (1) defines what a "replacement subscription” is:

"(1) −The terms and conditions of an account ... (“flexible account”) may provide for an account investor to be able to replace (in whole or part) a cash amount withdrawn by the account investor in any year by a replacement subscription of a cash amount ... (“replacement subscription”) made in that year."

This is all very difficult to understand. However it looks like a return to something like the pre-April 2024 situation where you can withdraw the current year's subscription from a “flexible account” and replace that cash into any ISA. Or am I completely misunderstanding this?

There is an Explanatory Note here: https://www.legislation.gov.uk/uksi/2025/733/note/made but that doesn't help me understand what's going on here.

Albermarle

Relevant new thread ?
Flexible ISA Replacement Rules Confusion — MoneySavingExpert Forum