A Cash ISA is a tax-efficient account where you pay no UK income tax on the interest earned.
As of March 31, 2026, the Plum Cash ISA is flexible.
While the standard annual deposit limit is £20,000, a Flexible Cash ISA allows you to withdraw money deposited in the current tax year and replace it within the same tax year without it affecting your annual ISA allowance.
Any withdrawals will first be deducted from current tax year deposits, per HMRC requirements.
Example 1: Withdrawing from Current Tax Year Deposits
Suppose you have already deposited £15,000 into your ISA during the current tax year, leaving you with £5,000 of your annual £20,000 ISA allowance remaining.
If you then withdraw £2,000 for an emergency, that amount is added back to your available allowance because it was withdrawn from money deposited in the current tax year.
As a result:
Original ISA allowance: £20,000
Amount deposited this tax year: £15,000
Amount withdrawn: £2,000
Updated remaining allowance: £7,000
This means you can still contribute up to £7,000 during the remainder of the tax year.
Example 2: Withdrawing from Both Current and Previous Tax Year Deposits
Let’s say your Plum Cash ISA contains:
£6,000 carried over from previous tax years
£5,000 deposited during the current tax year
Under HMRC rules, withdrawals are always taken first from contributions made in the current tax year.
If you withdraw £10,000:
The first £5,000 is treated as coming from your current tax year deposits.
This amount is removed from your used ISA allowance, effectively restoring that portion of your allowance for the current tax year.
The remaining £5,000 is treated as coming from funds deposited in previous tax years.
This amount is added to your Available to Replace balance.
You can replace this £5,000 back into your Plum Cash ISA only, without affecting your annual ISA allowance, provided the replacement is made before the end of the same tax year in which the withdrawal was made.
“Available to Replace” refers to money withdrawn from contributions made in previous tax years that you can put back into your Plum Cash ISA without using up your current year’s ISA allowance, provided the replacement is made before the end of the same tax year in which the withdrawal was made.
Important Limitations
Transfers & Closures: If you transfer your ISA to another provider or close the account, you lose the flexibility for those funds. In those cases, we are required to report your initial deposits to HMRC regardless of withdrawals.
Annual Reset: Every April 6th, your allowance resets to £20,000. Any "Replaceable Amount" from the previous year that wasn't paid back is lost.