Withdrawing from flexible ISAs and annual allowance

mjstephens2001

Hi,
Can I please check if money withdrawn from this year's ISA subscription in a flexible ISA still contributes to the £20k cap?

I have a flexible Zopa ISA, funded this tax year. I also have a Plum ISA (non-flexible). At the start of the tax year I put £5k in Zopa, and have also funded £15k to the Plum ISA (so total £20k, maxing out my allowance).

Can I now take money out of Zopa and add to Plum? E.g. If I withdraw £4k from Zopa and add it to Plum, does this mean:
a) I will have funded Zopa £1k this tax year, and Plum £19k (=£20k total), or
b) I will still have funded Zopa £5k, but also funded Plum £19k (=£24k total)?

I understand also that I can dip into previous years' money in the flexible Zopa ISA, but this doesn't affect this years allowance?

TIA

Ayr_Rage

You have used your annual allowance, £5k to Zopa and £15k to Plum.

Money withdrawn from a flexible ISA, Zopa in your case, can only go back into that same ISA according to the latest rules.

You CANNOT add it to your Plum ISA this tax year.

eskbanker

Ayr_Rage said:

You have used your annual allowance, £5k to Zopa and £15k to Plum.

Money withdrawn from a flexible ISA, Zopa in your case, can only go back into that same ISA according to the latest rules.

You CANNOT add it to your Plum ISA this tax year.

The rules on this were changed back to the previous iteration in July, so flexibly-withdrawn current year (only) money can now be paid back into any ISA again:

https://forums.moneysavingexpert.com/discussion/6624336/change-to-the-flexible-isa-regulation-5ddb-dated-15-july-2025

However, the main gov.uk page doesn't appear to reflect the legislative change, despite the document history saying that it was updated at the same time:

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

NannaGEO

Unfortunately the flexible ISA providers haven't grasped this and are still quoting on their websites that any funds withdrawn can only be paid back to the same account. They are still saying that in order to keep the full years allowance funds have to be transferred. I followed this and they closed my account and somewhere between them and the receiving bank they've still mucked up my remaining allowance. No doubt they will blame me and each other. 

If I had been aware about this guidance I would have just withdrawn the money I wanted to put in my other ISA. They wouldn't have closed my account and the new bank wouldn't have had the opportunity to muck up.

Catplan

Can you transfer it it Zopa to Plum, you’d need to ask Plum

t0rt0ise

NannaGEO said:

Unfortunately the flexible ISA providers haven't grasped this and are still quoting on their websites that any funds withdrawn can only be paid back to the same account. They are still saying that in order to keep the full years allowance funds have to be transferred. I followed this and they closed my account and somewhere between them and the receiving bank they've still mucked up my remaining allowance. No doubt they will blame me and each other. 

If I had been aware about this guidance I would have just withdrawn the money I wanted to put in my other ISA. They wouldn't have closed my account and the new bank wouldn't have had the opportunity to muck up.

In what way have they messed up? It doesn't matter what they think your remaining allowance is as long as you know it, and as long as they don't think you've got less allowance left than you want to pay in, which I doubt they'd do after a simple transfer.

eskbanker

NannaGEO said:

Unfortunately the flexible ISA providers haven't grasped this and are still quoting on their websites that any funds withdrawn can only be paid back to the same account. They are still saying that in order to keep the full years allowance funds have to be transferred. I followed this and they closed my account and somewhere between them and the receiving bank they've still mucked up my remaining allowance. No doubt they will blame me and each other. 

If I had been aware about this guidance I would have just withdrawn the money I wanted to put in my other ISA. They wouldn't have closed my account and the new bank wouldn't have had the opportunity to muck up.

It's difficult to follow from that what actually happened, so you might find it worthwhile explaining more detail about which providers are involved, how much money was deposited/withdrawn/transferred, and when, etc....