As I understand it, the government now allows us (since Oct 2015) to withdraw funds from an ISA and return them again within the same tax year without using up any of the annual allowance.
However, some ISA providers do not permit this, or have not yet implemented it. In such a case one is therfore forced move the ISA to a provider who does offer it.
Has anyone made use of this new freedom? What provider did you use?
What evidence do you have that providers don't allow it? Is this just
for fixed term ISAs, where withdrawals are not allowed anyway? In that
case I could understand it.
But if you have an easy access ISA which allows withdrawals at any time,
the provider can't stop you from withdrawing your money. And, AIUI, it
is a legal requirement for you to be able to re-invest it during the
same tax year - so surely the provider is breaking the law if they don't
I think this only applies to one year's worth of investment - current
limit about £15k. If you have built up a big balance over many years, I
wouldn't expect you to be able to withdraw (say) £50k and then put it
On Monday, February 15, 2016 at 11:49:41 AM UTC, Roger Mills wrote:
thdraw funds from an ISA and return them again within the same tax year wit
hout using up any of the annual allowance.
nted it. In such a case one is therfore forced move the ISA to a provider
who does offer it.
My ISA provider allows deposits only up to the annual maximum. That limit
is not expanded to account for withdrawals made during the same tax year.
They plan to implement this 'in the autumn 2016'. I don't see that they a
re breaking any law be declining to accept my money back again.
Oh dear, that is pretty much exactly what I was hoping to do. Perhaps I ha
ve misunderstood what the chancellor meant. if it only applies to the 15k p
ut in during the current year then it really is a rather small relaxation o
f the rules.
I've just checked, and the ability to withdraw money and then put it
back doesn't come into force until 6th April this year - 2016.
I can't see any specific reference to not being able to 'recycle' more
than a year's worth - so maybe you will be able to - but I would be
surprised were this the case.
On Monday, February 15, 2016 at 1:49:02 PM UTC, Roger Mills wrote:
withdraw funds from an ISA and return them again within the same tax year w
ithout using up any of the annual allowance.
mented it. In such a case one is therfore forced move the ISA to a provide
r who does offer it.
mit is not expanded to account for withdrawals made during the same tax yea
r. They plan to implement this 'in the autumn 2016'. I don't see that th
ey are breaking any law be declining to accept my money back again.
I have misunderstood what the chancellor meant. if it only applies to the 1
5k put in during the current year then it really is a rather small relaxati
on of the rules.
On the other hand, this says it started in Autumn 2015:
"The changes, which will come into effect from autumn 2015, will mean that
savers who need access to their ISA cash are not then penalised if they the
n want to save more later on that tax year. The only limit is that you need
to top up your ISA during the same tax year the withdrawal was made - if y
ou don't it will count towards your new allowance"
But this, which should be authoritative seems to say you can pull it out fr
om previous tax years, btu tat the measure does not start until April 2016.
"This measure will allow savers to replace cash they have withdrawn from th
eir ISA earlier in a year, without this replacement counting towards the li
mit on how much they can save in an ISA for that year. This flexibility wil
l be available to savers subject to the terms and conditions of their ISA.
This flexibility will be available in relation to both current year and ear
lier year ISA savings, where provided for in the terms and conditions of a
'flexible ISA', but will be subject to conditions in certain cases about wh
ich ISA provider can accept replacement amounts. "
The Individual Savings Account (Amendment) Regulations 2016,
definitely has the relevant new regulation 5DDB "have effect from 6th
The actual regulation seems to me to be permissive rather than
mandatory, so I suppose it's at least theoretically conceivable that not
all providers would make use of it.
â10. After regulation 5DDA insert-
5DDB.â(1) - The terms and conditions of an account (other than a
junior ISA account) (âflexible accountâ) 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 (âreplacement subscriptionâ) made in
On Monday, February 15, 2016 at 7:37:12 PM UTC, Iain Archer wrote:
thank you. I think that completes the picture. I just note that even though it is permissive, a subscriber can transfer their ISA to anther ISA provider, so it only needs one provider to offer this facility for a subscriber to make use of it.
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