pslewis

Midnight tonight ISA for 2013/2014 ends ......... now:-

If I top up an ISA for someone today to their max. can they then take that out tomorrow - but still have that full allowance locked as tax free?

In other words, does the amount at midnight stay the amount which is tax free forever - or if you remove some funds in future years does that portion removed lose it's tax free status?

If you understand what I'm saying?

paulr

Say the max is 5k a year. Today you manage to put in 5 k before the deadline. Tomorrow you take it out. That is this years 5 k allowance lost forever.

Matteeboy

When it's taken out, that's it - allowance lost.

It's £15k now - woo hoo!

paulr

Saving you approx £60 in a cash ISA.

Matteeboy

Eh?

My ISA currently "makes" me £60 a month. It's not much but it's the ONLY savings that make us any money. The rest make naff all.

pslewis

Right, it's as I thought ...... once the cash is removed from a ISA - even an old ISA - the tax advantage is lost on the amount removed?

paulr

15K in a cash ISA at 2%, current rates is £300 interest per year. You save tax at 20% for a standard rate taxpayer, which is £60.

Peanuts.

However, i'm saving in cash ISA's in the hope one day we see a return to decent interest rates.

albob

I don't think the 15k starts until july....

pslewis

It's worth much more as a higher rate taxpayer (as most are these days, under the Tories) .... not because they earn any more money, just the threshold has been reduced to the average wage!

And, yes, the £15,000 starts 1st July 2014.