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Retirement Planner · Track 2
G8 of 9 — Input guides

Bed and ISA

Bed & ISA is a strategy for moving GIA assets into ISA shelter before or during retirement — at the cost of a CGT event at the time of transfer. Done right, it permanently reduces the tax drag on your portfolio.

GIA (before) £100k Cost basis: £60k Gain: £40k CGT on transfer: £6,660 (18%) £93,340 net enters ISA Sell + rebuy in ISA wrapper ISA (after) £93k All future growth tax-free All withdrawals tax-free Breakeven: ~4–6 years Long-run tax saving: £12,000–£25,000+ ISA ALLOWANCE £20k/yr per tax year Spread over multiple years to manage CGT and ISA allowance
How to configure it
1
Enable ISA and set a target allocation first

Before adding Bed & ISA events, go to the Investments tab and ensure the Stocks & Shares ISA vehicle has at least one asset class with a % Target value set. Assets transferred into the ISA need an allocation to be invested into. The engine will not run correctly if ISA is enabled but has no target allocation.

Investments tab showing all four vehicles including Stocks and Shares ISA with asset classes and % Target columns filled
This is the most common setup error. Enable the ISA vehicle, give it an asset allocation with % Target values, then add Bed & ISA events.
2
Add a transfer event in the Special conditions tab

Go to the Special conditions tab and find the Bed & ISA events section. Click to add a transfer event. Set three parameters: Amount (£/yr) — how much to transfer annually (capped at £20,000 by the ISA allowance); Start age — when to begin transferring; and End condition — a fixed end age, a number of years, or Until GIA exhausted to run until the GIA is fully transferred.

Bed and ISA events section showing Transfer event 1 with Amount £20,000/yr, Start age 57, End condition Until GIA exhausted
Setting End condition to Until GIA exhausted at £20,000/yr is the simplest approach — it transfers the full ISA allowance each year until the GIA is empty, maximising the shelter without requiring you to calculate how many years it will take.
3
The £20,000 ISA allowance cap

The ISA subscription limit is £20,000 per tax year. The app description confirms the engine caps transfers at £20,000 per tax year regardless of the amount entered. Spread large GIA balances across multiple years. You can add multiple transfer events at different ages if you want to vary the annual amount — for example, £20,000/yr pre-retirement and a smaller amount post-retirement.

The engine processes the transfer in the month of the start age and then annually thereafter. Each transfer is a CGT realisation event — the gain is calculated, CGT exemption applied, and the net proceeds move to the ISA.
How the engine handles Bed and ISA
4
CGT event at transfer

Each annual transfer is a CGT realisation. The engine calculates the gain on the transferred amount using a proportional cost basis, deducts the annual CGT exemption (£3,000 in 2025/26), and taxes the net gain at your configured CGT rate. The after-tax proceeds enter the ISA.

The engine uses the GIA’s average cost basis rather than tracking individual lots. This is a simplification that is slightly conservative — in practice you can choose to transfer higher-basis lots first, reducing the CGT cost.
5
After-tax amount enters ISA and grows tax-free

The net proceeds (transfer amount minus CGT paid) are added to the ISA vehicle and invested according to its asset allocation. From this point, all growth and all withdrawals from those assets are tax-free — no CGT on future gains, no income tax on withdrawals.

When Bed and ISA adds value
6
Large GIA with a long remaining horizon

The bigger the GIA and the longer the remaining investment horizon, the more valuable the ISA shelter. A £100k GIA transferred into ISA at age 55 shelters 30+ years of growth from CGT. The cumulative success probability improves across all percentiles — most noticeably in median and better scenarios where the portfolio survives long enough to benefit from the tax saving.

Cumulative success probability chart showing improvement across the retirement horizon
7
When it may not be worth it

If the CGT cost is high (large unrealised gains, high CGT rate) and the remaining investment horizon is short, the upfront tax cost may not be recovered before the end of the plan. Use the What-if tab to test both scenarios: run the plan once with Bed & ISA events configured and once without, and compare success probability and median final portfolio.

Transfer in years when your CGT bill is lower — for example, a year with capital losses elsewhere, or when the £3,000 annual exemption would otherwise go unused. Multiple smaller transfers are often better than one large one.
Track 2 · G8 of 9