The value of investments and any income from them can fall and you may get back less than you invested.

Case Study: Flexible ISA helps with downsizing

Case Study: Flexible ISA helps with downsizing

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This case study shows how flexible ISAs can help overcome a blockage when moving to a new house.

Stephen and Caroline, both 65, have decided to move out of their large five-bedroom family home in favour of a smaller property close to their daughter and grandchildren. They have already identified the ideal property in their daughter’s village and are keen to move as soon as possible.

The plan

  • The couple’s existing home has been on the market for six months and, although there has been interest from potential buyers, they have yet to receive an offer.
  • They want to get a move on and have therefore decided to buy their new home before selling the old one.
  • Through prudent saving, Stephen and Caroline have built up stocks and shares ISAs worth £800,000 (£400,000 each).
  • They withdraw the £400,000 required to finance the purchase of their new home from their flexible ISA accounts.
  • Stephen and Caroline subsequently receive an offer for their old property and sell it three months later, still within the same tax year that they made their ISA withdrawals.
  • As their ISAs are flexible, they are able to use the proceeds of the house sale to replace the £400,000 they removed from their ISAs.
  • Stephen and Caroline are now happily settled in their new home, are enjoying spending more time with their grandchildren and still have £800,000 sheltered in tax-efficient ISAs (which could come in handy when it is time for the grandchildren to go to school).

 

 


 

The value of investments can fall and you may get back less than you invested.

Past performance is not a guide to future performance.

No investment is suitable in all cases and if you have any doubts as to an investment's suitability then you should contact us.

Please note that this document was prepared as a general guide only and does not constitute tax or legal advice. While we believe it to be correct at the time of writing, Brewin Dolphin is not a tax adviser and tax law is subject to frequent change. Tax treatment depends on your individual circumstances; therefore you should not rely on this information without seeking professional advice from a qualified tax adviser.

Brewin Dolphin Limited is authorised and regulated by the Financial Conduct Authority.

 

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