Is this a good idea?

ashford_2

HI all,

long time lurker, first time poster.

I received my PEP/Isa statement yesterday and was pretty happy to see that my initial investment has performed pretty well over the past 9 years and this got me thinking.

We are currently selling our house and moving abroad (within the EU). At the moment I/we also have a unit trust worth roughly 12,000, but no pension arrangements etc.

So, would it make sense to transfer the unit trust into an ISA wrapper and topping up to get our full joint allowance this year and arranging a quick re-mortgage on the house to raise an additioanl 14,000 to invest again after April.

The reason for the remortgage would be that on completion of the house sale (when we received the equity) we would probably not be working anymore (so no longer taxpayers) and that would probably affect our ability to take advantage of an ISA allowance - if that makes sense...???

So is this a sensible plan and possible in the circumstances above?

Also, i understand that we can keep our ISAs and Peps in the Uk even if we are no longer resident?

And if a fund is underperforming over the years, as overseas residents, would we still be able to transfer money to different funds?

Sorry for all the questions and thanks for your time....

tradetime

and arranging a quick re-mortgage on the house to raise an additioanl 14,000 to invest again after April.

Others will probably disagree with this, but I have always been of the opinion that borrowing money to invest is a cardinal sin. Never risk what you can't afford to lose, and if you have to borrow it, then likely you can't really afford to lose it. All just my opinion of course.

ashford_2

tradetime wrote: »

Others will probably disagree with this, but I have always been of the opinion that borrowing money to invest is a cardinal sin. Never risk what you can't afford to lose, and if you have to borrow it, then likely you can't really afford to lose it. All just my opinion of course.

Thanks tradetime, but we're selling the house now, so although you're technically correct, in practice we are just getting an advance on the equity we will be receiving a couple of months down the line....

DeepSporran

ashford wrote: »

The reason for the remortgage would be that on completion of the house sale (when we received the equity) we would probably not be working anymore (so no longer taxpayers) and that would probably affect our ability to take advantage of an ISA allowance - if that makes sense...???

Are you planning to return to the UK and become taxpayers at some point in the future ?

If not, I can't see the point of the remortgage. An ISA is worth having because it reduces your UK tax liability. If you don't pay UK tax (and will never do so in the future) then why put more money into an ISA if it is going to involve extra costs (I assume the remortgage will involve some fees.)

By all means invest directly in the funds/shares/bonds etc that your ISA would be investing in, but you may as well wait till you have the funds after the house sale completion.

I suppose it may actually be cheaper in terms of initial fees etc to invest via an ISA rather than directly in a fund. However, I suspect that any savings there would be eaten up by the extra costs of a remortgage.

nicko33

ashford wrote: »

Thanks tradetime, but we're selling the house now, so although you're technically correct, in practice we are just getting an advance on the equity we will be receiving a couple of months down the line....

Is the house sale 100% guaranteed to complete?
Could the buyers still change their mind?

I too am in the process of selling my house, and I have a bit of a spending spree in mind for a bit of the proceeds, but I'm not spending any of it until the sale is completed.