Can you move more than £20,000 into a cash Isa from a stocks and shares Isa? 

I want to make a £60,000 transfer and in theory I think this should be feasible, as long as I don’t withdraw the money outside of an Isa wrapper in between. 

However, I don’t seem to be able to find any information to confirm this.

I’m yet to find a cash Isa that states its limit as over £20,000 per year. 

Does this mean that although it’s hypothetically possible, in reality it’s not, or would a provider accept a transfer above the annual allowance?

Moving money: Our reader wants to know if they will be able to transfer £60,000 from one Isa to another, even though it is over the £20,000 annual Isa allowance

Helen Kirrane of This is Money replies: At the beginning of each tax year, savers get a fresh Isa allowance. 

This means it is possible to put up to £20,000 into either savings or stocks and shares, while shielding interest, dividends or capital gains from tax.

There is a difference between the amount of new money you can put into an Isa in a given tax year, and the amount of money you can transfer from an old Isa into a new Isa you open. 

You can transfer money between Isas to consolidate savings into one pot without needing to worry about the £20,000 annual allowance. 

Transferring funds between Isas won’t count towards this allowance, as the £20,000 limit only applies to money paid in from outside an Isa.

To get some expert advice on your question, we spoke to Laura Suter, director of personal finance at stockbroker AJ Bell, and Sarah Coles, head of personal finance at stockbroker Hargreaves Lansdown.  

Laura Suter replies: I can see the confusion here. The key point is: Isa transfers don’t count towards your £20,000 annual limit, as long as the funds stay within the Isa system. 

That means you’re transferring directly from one Isa provider to another using the official transfer process  – and not withdrawing the money yourself).

That means you’re transferring directly from one Isa provider to another using the official transfer process  – and not withdrawing the money yourself.

So, if you have £60,000 in a stocks and shares Isa and want to move it all to a cash Isa, that’s entirely possible – provided the cash Isa provider accepts transfers in. Most do, but some may have restrictions or not highlight it clearly on their websites.

What you should do is check with your chosen cash Isa provider to confirm they accept transfers in, and then initiate the transfer through them – not by withdrawing and redepositing the money. 

That way, your Isa status and tax-free benefits remain fully intact.

Sarah Coles replies: There are several cash Isa providers allowing transfers in from a stocks and shares Isa. At the time of writing, the most competitive easy-access cash Isa, and the best over two and five years allow it. 

In the one-year and three-year market, you can transfer into one of the top three accounts from a stocks and shares Isa. 

The transfer doesn’t use any part of this year’s £20,000 allowance, so the norm is to allow you to transfer as much as you like.

Some will have a maximum on the cash Isa funds you can hold with them, but this tends to be a pretty hefty amount – often hundreds of thousands of pounds. 

You will usually not want to hold more than £85,000 with each institution anyway, so it’s all protected by the Financial Services Compensation Scheme.

Once you find the best rate for you, check they allow for stocks and shares transfers in. 

The FAQs on the website will let you know about any limits.

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