Flexible ISA withdraw and Fixed rate ISA

Descrabled

I have this year's flexible ISA opened with new money on 7 April 2025. I understand that I have the following options:

1. Open a new fixed rate ISA and transfer the full amount from the flexible ISA
2. Open new fixed rate ISA(s), withdraw less than the full amount of the flexible ISA and fund the new fixed rate ISA(s). Leave the existing flexible ISA with reduced funds.
3. Withdraw less than the full amount in the flexible ISA and add this amount to my existing fixed ISA with Kent Reliance and/or Shawbrook banks.

I have already saved the maximum £20,000 in a number of different ISAs this tax year. Including the flexible ISA, the Shawbrook ISA, and others. The Kent Reliance ISA was opened last tax (2024-25) and was funded by transfer of "old" ISA money.

Have I correctly interpreted the rules?

eskbanker

Assuming your KR and Shawbrook ISAs still allow contributions then I think each of those are valid, but I'm not sure they represent the full range of options.  However, it already sounds complicated enough, so it'll really come down to validating what you actually want to achieve, rather than hypothesising further about potential options!

Descrabled

Thanks eskbanker for your confirmation. I have a ladder of fixed ISAs which mature over the next five years. I am well over state pension age and have already withdrawn from S&S investment. I usually fund new 5y and 3y ISAs each year

I opened the flexible ISA as an interim measure, as I was unsure how interest rates would move. I don't need the interest, and neither does the taxman, as my pensions exceed my expenditure. 

fuzzzzy

Have you asked Shawbrook and Kent Reliance if they will accept a transfer in to their fixed rate ISAs? 

I suspect they would only allow a transfer in during the initial funding window or new contributions in future tax years.

Albermarle

fuzzzzy said:

Have you asked Shawbrook and Kent Reliance if they will accept a transfer in to their fixed rate ISAs? 

I suspect they would only allow a transfer in during the initial funding window or new contributions in future tax years.

The OP is not proposing a transfer, but taking money from a flexible ISA and adding it to an existing fixed rate ISA, effectively as a new contribution.
Most fixed rate ISAs would not allow this, but Shawbrook definitely do .

fuzzzzy

Albermarle said:

fuzzzzy said:

Have you asked Shawbrook and Kent Reliance if they will accept a transfer in to their fixed rate ISAs? 

I suspect they would only allow a transfer in during the initial funding window or new contributions in future tax years.

The OP is not proposing a transfer, but taking money from a flexible ISA and adding it to an existing fixed rate ISA, effectively as a new contribution.
Most fixed rate ISAs would not allow this, but Shawbrook definitely do .

Oh I see. Kent Reliance I think would also accept a new contribution.

So you no longer need to return money to the original flexible ISA within the same tax year?

I guess I am not really up to date on flexible ISA rules. It all sounds rather complicated.

eskbanker

fuzzzzy said:

So you no longer need to return money to the original flexible ISA within the same tax year?

I guess I am not really up to date on flexible ISA rules. It all sounds rather complicated.

That's right - the rules were last changed in July 2025, permitting current year money withdrawn from a flexible ISA to be replaced in any ISA within the same tax year, i.e. back to how the rules were before April 2024.