I am a little bit confused about ISAs and how they work. I currently have ISA savings account with HSBC where I’ve put in the max amount of £20K that’s allowed in a year. Over the year the interest has accrued on it and I have two questions regarding this
If due to the interest on the savings it has become, let’s say £20,100 - Does this mean the government now considers me as going over the limit and will tax me on the interest I’ve gained? i.e on the £100 for example
Also, I understand that each year there is an ISA allowance limit. Does this mean I can keep the £20K allowance from the 18/19 in the existing ISA account, then let’s say for the 19/20 year when Monzo introduces cash ISAs I can start putting money into that? or do ISAs work in a way wherein one given year you can only have £20K tax free savings?