Flexible (stocks and shares) ISAs
Discussion
Hi all. Does anyone know if flexible ISAs (where you can withdraw money during the tax year and put it back without affecting your £20k allowance) applies to stocks and shares ISAs too?
I participate in a company SAYE scheme and the price has increased substantially in the 5 years I ve had them meaning I will have made a tidy profit which obviously I don t want to pay CGT on if I can help it.
So my question is, can I put £20k worth in the ISA, sell them and withdraw it as cash, then put another £20k worth of shares in the ISA and then sell again? All within the same tax year?
Company is a FTSE 100.
Cheers all for any help.
I participate in a company SAYE scheme and the price has increased substantially in the 5 years I ve had them meaning I will have made a tidy profit which obviously I don t want to pay CGT on if I can help it.
So my question is, can I put £20k worth in the ISA, sell them and withdraw it as cash, then put another £20k worth of shares in the ISA and then sell again? All within the same tax year?
Company is a FTSE 100.
Cheers all for any help.
Edited by audi321 on Tuesday 21st April 21:07
Trading212 is a flexible stocks and shares ISA, but I don t fully understand what you want to do;
If you max your £20k ISA tax allowance, then sell the £20k, then put another £20k in, you re not gaining anything but you could do that. Anything you take out, you can put back in if you want.
Unless you re thinking of putting £20k in, then let s say the shares increase in value now to £25k, you COULD sell/withdraw that full amount and put £20k back in, effectively banking the £5k you made.
Or finally, if you have a stocks and shares ISA already, and you want to transfer to a flexible one, it just depends on how much you ve already contributed to your allowance. So let s say you have used £10k of your allowance already, and they ve risen by £20k meaning you have £30k in your ISA . If you withdraw/sell the full £30k, you ll then have the full £20k allowance to put back (because that £10k you previously used, you re just essentially pulling it out then adding again).
If you just keep adding £20k, selling £20k, adding £20k, you’re not making anything unless they keep gaining value in that short space of time. There aren’t loop holes even if it’s a flexible ISA.
If you max your £20k ISA tax allowance, then sell the £20k, then put another £20k in, you re not gaining anything but you could do that. Anything you take out, you can put back in if you want.
Unless you re thinking of putting £20k in, then let s say the shares increase in value now to £25k, you COULD sell/withdraw that full amount and put £20k back in, effectively banking the £5k you made.
Or finally, if you have a stocks and shares ISA already, and you want to transfer to a flexible one, it just depends on how much you ve already contributed to your allowance. So let s say you have used £10k of your allowance already, and they ve risen by £20k meaning you have £30k in your ISA . If you withdraw/sell the full £30k, you ll then have the full £20k allowance to put back (because that £10k you previously used, you re just essentially pulling it out then adding again).
If you just keep adding £20k, selling £20k, adding £20k, you’re not making anything unless they keep gaining value in that short space of time. There aren’t loop holes even if it’s a flexible ISA.
Edited by Prohibiting on Tuesday 21st April 20:44
Prohibiting said:
Trading212 is a flexible stocks and shares ISA, but I don t fully understand what you want to do;
If you max your £20k ISA tax allowance, then sell the £20k, then put another £20k in, you re not gaining anything but you could do that. Anything you take out, you can put back in if you want.
Unless you re thinking of putting £20k in, then let s say the shares increase in value now to £25k, you COULD sell/withdraw that full amount and put £20k back in, effectively banking the £5k you made.
Or finally, if you have a stocks and shares ISA already, and you want to transfer to a flexible one, it just depends on how much you ve already contributed to your allowance. So let s say you have used £10k of your allowance already, and they ve risen by £20k meaning you have £30k in your ISA . If you withdraw/sell the full £30k, you ll then have the full £20k allowance to put back (because that £10k you previously used, you re just essentially pulling it out then adding again).
If you just keep adding £20k, selling £20k, adding £20k, you re not making anything unless they keep gaining value in that short space of time. There aren t loop holes even if it s a flexible ISA.
I have (for example) the option to purchase £40k of shares that I have effectively paid £5k for. I want to sell all £40k to repay my mortgage. If I can do this flexible ISA thing then effectively I can get all £40k within an ISA and therefore CGT exempt. The SAYE scheme allows for transfers to ISAs within 90 days of exercising the option. If you max your £20k ISA tax allowance, then sell the £20k, then put another £20k in, you re not gaining anything but you could do that. Anything you take out, you can put back in if you want.
Unless you re thinking of putting £20k in, then let s say the shares increase in value now to £25k, you COULD sell/withdraw that full amount and put £20k back in, effectively banking the £5k you made.
Or finally, if you have a stocks and shares ISA already, and you want to transfer to a flexible one, it just depends on how much you ve already contributed to your allowance. So let s say you have used £10k of your allowance already, and they ve risen by £20k meaning you have £30k in your ISA . If you withdraw/sell the full £30k, you ll then have the full £20k allowance to put back (because that £10k you previously used, you re just essentially pulling it out then adding again).
If you just keep adding £20k, selling £20k, adding £20k, you re not making anything unless they keep gaining value in that short space of time. There aren t loop holes even if it s a flexible ISA.
Edited by Prohibiting on Tuesday 21st April 20:44
Was chatting to a mate recently who's not long done this...had I think ~£80k SAYE proceeds maturing, so created a new flexible S&S ISA, moved ~£80k of stuff into it from existing ISA, sold that stuff and pulled the cash out, transferred the SAYE shares across and sold them all CGT-free. All with the blessing of the ISA provider and company SAYE people so presumably fine.
Bit fiddly and I suppose not without some risk (e.g. if stock had roofed it between exercise + transfer to blow through the headroom created initially), but nice little touch I thought.
Bit fiddly and I suppose not without some risk (e.g. if stock had roofed it between exercise + transfer to blow through the headroom created initially), but nice little touch I thought.
As I read it, you're limited to £20K value per year anyway from your scheme to an ISA:
https://www.gov.uk/tax-employee-share-schemes/tran...
Nice idea to swerve the CGT but it would be mental if they'd missed that loophole. You can't do in-specie transfers from a GIA into an ISA (only between ISAs) at all - the ability to do it is a special rule for employee schemes.
https://www.gov.uk/tax-employee-share-schemes/tran...
Nice idea to swerve the CGT but it would be mental if they'd missed that loophole. You can't do in-specie transfers from a GIA into an ISA (only between ISAs) at all - the ability to do it is a special rule for employee schemes.
Edited by Sheepshanks on Wednesday 22 April 08:51
NowWatchThisDrive said:
Was chatting to a mate recently who's not long done this...had I think ~£80k SAYE proceeds maturing, so created a new flexible S&S ISA, moved ~£80k of stuff into it from existing ISA, sold that stuff and pulled the cash out, transferred the SAYE shares across and sold them all CGT-free. All with the blessing of the ISA provider and company SAYE people so presumably fine.
Bit fiddly and I suppose not without some risk (e.g. if stock had roofed it between exercise + transfer to blow through the headroom created initially), but nice little touch I thought.
Does your mate work for Barclays by any chance?Bit fiddly and I suppose not without some risk (e.g. if stock had roofed it between exercise + transfer to blow through the headroom created initially), but nice little touch I thought.
NowWatchThisDrive said:
Was chatting to a mate recently who's not long done this...had I think ~£80k SAYE proceeds maturing, so created a new flexible S&S ISA, moved ~£80k of stuff into it from existing ISA, sold that stuff and pulled the cash out, transferred the SAYE shares across and sold them all CGT-free. All with the blessing of the ISA provider and company SAYE people so presumably fine.
Bit fiddly and I suppose not without some risk (e.g. if stock had roofed it between exercise + transfer to blow through the headroom created initially), but nice little touch I thought.
If my reading is correct then "recently" might be significant there - HMRC has a very big computer and should pick this up at some point. Although if the £20K annual limit is correct then I'm surprised the ISA provider accepted the transfer. Bit fiddly and I suppose not without some risk (e.g. if stock had roofed it between exercise + transfer to blow through the headroom created initially), but nice little touch I thought.
Don't understand the point about the shares going up in value - you've got time to transfer them regardless.
I think it's actually a 90-day issue....
In that you can do what you're suggesting, transfer into a flexible S&S ISA (Equiniti for example) and replace.... but it needs to be done within 90 days from maturity which might be the problem
so the process AIUI is transfer £20k immediately, sell, remove funds, then ask the S&S ISA provider to do it again.... but it needs to complete in 90 days
In that you can do what you're suggesting, transfer into a flexible S&S ISA (Equiniti for example) and replace.... but it needs to be done within 90 days from maturity which might be the problem
so the process AIUI is transfer £20k immediately, sell, remove funds, then ask the S&S ISA provider to do it again.... but it needs to complete in 90 days
ikarl said:
so the process AIUI is transfer £20k immediately, sell, remove funds, then ask the S&S ISA provider to do it again.... but it needs to complete in 90 days
That may well work in practice - but it breaks the HMRC rule I linked to earlier. I don't know what the chances are of getting caught - I've heard of all sorts of ISA rule breakingin the past (they're increasingly flexible now) but never seen reports of people being picked up on it.asfault said:
yeah i thought this wasnt possible but reading into it more it seems you can do it.
So if you have more than 20k from saye its worth doing. but make sure your provider supports it.
No you can't:So if you have more than 20k from saye its worth doing. but make sure your provider supports it.
"Transferring your shares to an ISA
You can transfer up to £20,000 of employee shares into a stocks and shares Individual Savings Account (ISA) if you have shares in a:
Save As You Earn (SAYE) scheme"
https://www.gov.uk/tax-employee-share-schemes/tran...
Thanks for the replies guys. Seems to be a bit of a loophole but I’ve found out it definitely IS possible to do this with a flexible ISA.
I called Barclays stockbrokers and they’ve said (and I now have it in writing) that as long as it’s done within 90 days of exercising the option to buy, then you can do it multiple times with their flexible stocks and shares ISA. They did caveat it with that transfers can take up to 30 days and if I try to do it over the £20k by the time they come in, and the share price has gone up, then they will reject it and I would need to start over and the ‘up to 30 days’ starts again.
Seems every day is a school day
I called Barclays stockbrokers and they’ve said (and I now have it in writing) that as long as it’s done within 90 days of exercising the option to buy, then you can do it multiple times with their flexible stocks and shares ISA. They did caveat it with that transfers can take up to 30 days and if I try to do it over the £20k by the time they come in, and the share price has gone up, then they will reject it and I would need to start over and the ‘up to 30 days’ starts again.
Seems every day is a school day
Interesting to read this,
I am going down a half similar route of trying to get the shares into my S&S ISA to avoid having to pay CGT. Proving to be a bit more complex than I thought with Trading 212 not able to do it directly! The errors you make the first time you have to do things!
I am going down a half similar route of trying to get the shares into my S&S ISA to avoid having to pay CGT. Proving to be a bit more complex than I thought with Trading 212 not able to do it directly! The errors you make the first time you have to do things!
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