Tax on interest in a Cash holding in a Stocks & Share ISA

[peter@2711.co.uk]

I read that from 2027 "the Government will charge customeres tax on the iterest from a Cash Holding in a Stocks and shares ISA"

I am in my 80s and currently have c £150,000 Cash in my Share ISA producing c£5,000 pa interest. The money represents some excellent dividends and the odd share sale. I pay 40% tax on income, so this new ruling would appear to cost me c£2,000 pa. So I thought I would trasnsfer £100,000 to a New Cash ISA and put £50,000 back into shares. This request has been rejected, because it is not possibled to transfer money from a Share ISA into a Cash ISA.

I assumed that until 5 April 2026 I can withdraw £20,000 from the Share ISA and put into a New Cash ISA, but would be interested to learn the latest advice on this problem.
Many thanks

[AGoodman]

The proposals are still unclear and won't take effect till next year soonest so I would avoid making any rushed decisions

Also, are you certain you can't transfer from a shares ISA to a cash ISA? I'm pretty sure you can and maybe your provider has misunderstood.

https://www.gov.uk/individual-savings-accounts/transferring-your-isa

[peter@2711.co.uk]

Thanks. Agree best "wait". I only asked one Bank about making a transfer to a New Cash ISA and got a not policy rejection.