CFD and ISA allowance

Did you guys realise if you transfer funds from ISA to CFD back to ISA it counts as a deposit… 🤷

I’ve transferred funds between them and it’s now eaten up some of my ISA allowance even though no additional deposits were made??

@David @Joey_Fantana @Jobloggs

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Well that’s how it works, taking money out and putting it back in will always count as new deposit, you should be careful when doing that.

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Yep, if you move money out of your ISA it doesn’t ‘free up’ your allowance.

A deposit is a deposit, it doesn’t matter if it’s the same money going in twice.

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I thought a deposit was a deposit, didn’t realise a transfer counted. When the new tax year starts in April can we just add to our current ISA and the dial goes back to 0%? OR do we have a separate account again?

4.3. This Stocks and Shares ISA is not a flexible Stocks and Shares ISA. Any money you pay in will count towards your ISA subscriptions for the current tax year; withdrawals are not offset against deposits when calculating subscription limits. You are only allowed to deposit up to the maximum ISA limit in a tax year.

Source:

https://www.trading212.com/en/isa-additional-terms

any money put into an ISA regardless of source, will use up your allowance. even if you wait until april to put it in, you will just end up using a part of that next years allowance. taking money out of it will not free up the allowance and will use up more allowance re-deposited.

almost every time an ISA question has been asked this last year this has been mentioned.

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Yes deposit being the key word and I wasn’t depositing anything additional my cumulative deposit total remained the same. I understand the principal but didn’t realise I could deposit £1000 move it around 19 times, no further deposits and use up my ISA…

The keyword is flexible though.

That word is subjective

That’s the bit that allows you say withdraw a say grand and put back a grand in the same tax year without it taking it again from your £20k allowance.

It’s the same with say a cash ISA at a bank. If you intend to add and take back during the year make sure it’s flexible (doesn’t impact on adding withdrawn back) and easy access (as in no time frame / penalties).

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Ok I just assumed as it was internal transaction it wouldn’t count but obviously I was wrong.

Assumptions are not good.

Dao when it comes to April does it go back to 0% and I can just add to my already existing account/portfolio with a new 20k limit (if that’s agreed by the gov)?

Your ISA and CFD are separate accounts, so even if you own them both it still counts as a deposit into your ISA. You keep using this word ‘transfer’ as if it’s supposed to be something else?

It’s the same way that moving money from your bank account to your ISA uses up your allowance, even though you own both accounts.

Well no, a deposit is a deposit, moving from an external source to T212 and a transfer is moving about internally, they are two different things.

A deposit comes from a 3rd party aka my bank. A transfer does not. So yes, they are two different things.

if you stick with T212 for your S&S ISA then the allowance count will go back to 0 with the change of tax year in april and will roll the account onto that year so you only have a single account and portfolio with all your funds and holdings.

CFD, Invest and ISA are all separate accounts under a single customer profile, the move funds feature is not a transfer so much as withdrawing from one account to deposit in another account under your name without having to first send the funds back to source.

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Thanks for your help, understood.

Can’t really add much to what’s already been said here, really.

Regardless of nomenclature (transfer, deposit, etc.), if the money comes out of your ISA, it can’t go back in and occupy the allowance it previously occupied.

Flexi ISAs allow this. These ISAs are not flexi.

Come April 6th, you can top-up with another full years allocation (£20k for now).

Just for full clarity (your 0% comment had me wondering), you do not need to remove any of your current ISA holdings at this point. The clock just resets and you can add up to another £20k on top of what you already have in there.

I’ll personally be shifting the cash in my Invest account over, for example.

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I wish I had £20K to put into an ISA myself. :laughing:

But yeah, don’t try and withdraw cash when possible if you want to withdraw the money, only to put it back in.

Only do it if you need the money in the bank and you know you won’t go over the £20K limit.

It resets when the new Tax Yeatr rolls over.

I have only used £80 for this year so I am good withdrawing and depositing as I only have 4 months left.