Cash ISA Discussion/Question

daviejohn

The Alliance and Leciester Cash Isa has a bonus of 0.7% until April 2007 which is good. However, have you checked to see if there is any exit fee if the Cash is transferred from them to another Cash Isa provider at the end of the bonus period?

I seem to remember that A & L instigated a charge in the past for such tranfers to rivals.

Frank1in

"
The Alliance and Leciester Cash Isa has a bonus of 0.7% until April 2007 which is good. "


I have recently been promoted which means for the first time since university i will be able to save some money. I want to start an ISA but I m confused. You say that A&L have bonus of 0.7%, does this mean that the interest rate is 5.2% plus 0.7%? If not what is the bonus for?

Would it be best and simpler to go for the halifax account?

please help me!!!

Frank1in.

Linguistic_Chimp

I am new to the ISA game too and was wondering if you have to declare the money you have in an ISA when filling out your Tax self-assessment form?

grumbler

Frank1in wrote:

... A&L have bonus of 0.7%, does this mean that the interest rate is 5.2% plus 0.7%?

No, 5.2% includes 0.7%.

what is the bonus for?

To attract you in a hope that you will fill to lazy or will forget to switch your ISA to other provider when bonus rate expires.

Would it be best and simpler to go for the halifax account?

Who knows? They don't guarantee this rate and can drop it anytime too. You are free to transfer your ISA to other proveder. Neither Halifax nor A&L charge you for doing this.

grumbler

Linguistic_Chimp wrote:

I am new to the ISA game too and was wondering if you have to declare the money you have in an ISA when filling out your Tax self-assessment form?

No. In fact you declare not money in accounts, but only taxable interest. ISA interest is not taxable.

isasmurf

Linguistic_Chimp wrote:

I am new to the ISA game too and was wondering if you have to declare the money you have in an ISA when filling out your Tax self-assessment form?

To add to what Grumbler's already said (we make a good team, eh Grumbler!? :rotfl: ) you don't have to, because your ISA manager will report it to the taxman.

barbara22

Totally ignorant on ISA's, have just applied to Alliance & Leicester to open one of theirs, but can only afford at the moment to pay in £50 per month, not much but I need to do something to save money. I know there is a good guide to ISA's on this website and have read it, now completely confused! Would I be better off going for a more straightforward interest paying savings account as I'm only paying in a relatively small amount each month? It appears not, as I won't be paying tax on the pennies of interest earned in an ISA?

Sorry - this sort of question must have been asked loads of times but any advice will be appreciated please.

grumbler

barbara22 wrote:

Would I be better off going for a more straightforward interest paying savings account as I'm only paying in a relatively small amount each month? It appears not, as I won't be paying tax on the pennies of interest earned in an ISA?

With instant access saving account you wouldn't be better because of tax on interest. However, regular saving accounts pay now up to 10% gross (A&L, Barclays) that is 8% net, much more than ISA. When account matures in 12 months you can move money into ISA. However, with £50 p.m. difference is not very big - just about £15 extra for a year. Both Barclays and A&L require opening current account with them.

barbara22

Thank you Grumbler - just as I thought. However, with so little to be saved by going to a higher interest straight savings account, I might just as well go for the ISA anyway as these will be the more permanent financial features in my life. Also, like all lazy people, I don't really want to mess about with more than one type of account, EXCEPT of course transferring into better ISA's, if and when on offer each financial year. Just one little quickie of a thought, I assume that during the year, I can increase my payments as and when I am able? (A couple of my significant debts get paid off in July/August this year, which means I'll have extra money available to save). If the obvious answer is Yes, please do not trouble yourself to reply - I realise I'm probably just being thick!

A & L haven't stated that I must have a current a/c with them though, they have just taken my present bank details without comment.

grumbler

barbara22 wrote:

...I assume that during the year, I can increase my payments as and when I am able?

Possibly some other ISAs have restrictions, but not A&L ISA as long as you stay within £3000 allowance.

A & L haven't stated that I must have a current a/c with them though, they have just taken my present bank details without comment.

They require this only for their 10% regular saving account.