ISA withdrawals and tax implications

freeform

I’ve seen a previous article on the site that says you don’t lose tax benefits if you withdraw (rather than transfer) and another that says never to withdraw or you lose all of the tax benefits.

I had planned on transferring in the next couple of days and building up to 3k for this year, but would then need to withdraw money later in the year when I return to Australia. So I’m a little confused at the moment about whether to transfer or just open a savings account...

jem16

What is meant by losing tax benefits is that once you take it out of the ISA wrapper it's then subject to tax. You can't replace the money you take out of an ISA.

If you are using the money to buy something then it doesn't really matter. You will have gained more interest from it being in a tax-free shelter in the first place.