Glossary · UK
What is Bed and ISA?
Selling shares in a taxable account and immediately repurchasing them inside an ISA to shelter future gains and dividends.
Full Definition
Bed and ISA is a legitimate strategy where you sell holdings from a general investment account and rebuy the same shares within a Stocks & Shares ISA on the same day, using your annual ISA allowance (£20,000 for 2025/26). The sale crystallises any capital gain — useful for using the £3,000 Annual Exempt Amount each year — while the repurchase shifts future growth and dividends out of HMRC's reach. Most platforms offer it as a single instruction with reduced dealing costs. Unlike the old «bed and breakfasting» trick, Bed and ISA is not caught by the 30-day matching rule because the shares are inside a new tax wrapper.