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[Raul (Ann Onymuz)]

@hgrd

What happens if I reach the 20K limit and the performance of the stocks makes the investment greater that 20K? - If let’s say I invest 20K in ETFs through the app and the ETF performance makes those 20K in 21K in two months .

I’m not an expert, but here’s my understanding.

You put £20 k in cash in your Stocks and Shares ISA. You then use that money to buy shares in companies ETFs or other financial assets. According to the current legislation any gains realized with those £20 k are tax free. So yeah, if the ETF price performance turns those 20 k into 21 k in two months, or in two days, or in two years, then yes that extra £1000 is tax free if you were to sell the ETF at that point, cuz it’s inside the ISA which is a tax wrapper. Any dividends received within the ISA are also tax free.

@hgrd

Once the first tax year is over, can I invest another 20K in the same ISA (i.e. Freetrade) for the next year?

Yes you can. Unless the government changes the rules of the game.

@hgrd

or do I have to change ISA provider?

No, you don’t have to change ISA provider. But you can if you want to. Just bear in mind you can only pay into one ISA per fiscal year.

@hgrd

What happens to those 20K first invested in year 1?

It depends on what you want to do with it. You can keep it there, invested or in cash, you may be able to transfer it to another provider. You may withdraw the money…

Check this blog post for more information

The totally NOT complicated investment tax post

[image] Last update: 10th April 2019 “Tax doesn’t have to be taxing.” So says everyone’s favourite advert from HMRC. Well, it doesn’t have to be, but they’re making a good go of ensuring that it is. Contrary to their claim, tax is a complex subject. However, there are a number of factors that make tax on stock market investments a bit more simple and much less burdensome than other types of tax. This is great: we generally like to simplify and clear up information asymmetry as…