I have opened my first ever ISA and am confused by the tax implications.
I am 38 and want to save for the long term, ideally until I’m 60. I am putting £100 a month in and don’t plan on taking any money out.
My basic understanding is that I am allowed to save up to £20k a year tax free. Obviously I won’t be anywhere near that number for a fair few years but when I do exceed that threshold this is where I am confused.
Ideally, I would want to save, save and save until I am 60 but then would I be taxed a chunk when taking it all out in one go. Nearer the end term would I be better to withdraw £20k a year for a number of years to avoid paying tax?
Im so confused and have looked for answers online but this only leads to more confusion.
Can anybody give me some help please. Thx.