New ISA Freedom
The Chancellor has announced greater flexibility in taking money out of ISAs and then reinvesting it.
Previously, if an investor took money out of an Isa in a tax year, they would automatically lose that part of their annual allowance. Any reinvestment would count towards the annual limit. Osborne has now promised “complete freedom” on moving money in and out of ISAs. Investors will now have the flexibility to withdraw and reinvest into ISAs without losing their tax-free allowance.
We see this as a considerable step forward because now clients will be able to use their cash ISAs as their emergency funds without fear of losing the tax free benefit if they are able to put the money back in the same tax year.
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