£3000 in ISA now?

nrsql

life assurance has been dropped. You can have a 3k cash and 4k share isa or a 7k maxi isa.
Holding cash on deposit in a maxi isa will probably give a much lower interest rate than a mini cash isa.

Kenny4315

Why not also bung a bit into a shares ISA given that the market looks extremely promising for the year. I think the limits are £3000 into cash ISA, and then further £4000 into a shares ISA, all gains are tax free. I personally like to keep things simple, I choose to put my ISA stock (and any other Personal Investment Plans (if want to put more in the market than ISA will allow) into a simple FTSE 100 tracker fund. I would say it is medium risk/return, but one nice advantage is that you can easily monitor what the FTSE 100 is doing from day to day, just by using ceefax, or whatever as it is a main indicator. This way you can quickly get a feel for the way the market is going. In 2006 alone the market has made upward movements of over 2%. It's a bit of a gamble but I think it's worth the risk at present, given the risks involved in other investment mediums.

Paul_Herring

MoneyMonkey wrote:

I could be talking nonsense here (so feel free to abuse me!), but I thought that the limit for a mini cash ISA was 3K. Also that you can have 3 mini ISAs (1 of each type - cash, stocks, life assurance), so long as they total no more that 7K.

However, a maxi ISA (of which you can onely have one), can have upto 7K in any combination. Therefore can you not put 7k into a maxi ISA, but only have it in terms of a cash holding?

MM.

1) They've done away with the life assurance for mini-ISA's from 6th April 2005 (http://www.moneysupermarket.com/ISA/GuideToIsas.asp). Instead £1000 has been added to the Stocks and shares component. In summary you can have either:

A) A £3000 cash mini ISA plus £4000 stocks and shares mini ISA

A £7000 stocks and shares maxi ISA
In option B, only a limited amount may be held as 'cash' (£3000 - see http://www.hmrc.gov.uk/isa/faqs.htm) In any event, interest returned on cash components in a s&s ISA are typically very low.



2) These limits are *per year* and you must choose either option A or B above at the start of each tax year.

So for example you could obtain:

1994/5: £3000 cash + £1000 Assurance + £3000 s&s
1995/6: £7000 s&s (Up to £7000 as s&s, or optionally £3000 as cash earling a pittance with the rest as s&s)
1996/7: £3000 cash + £4000 s&s
etc.

eilz

Is there a MAximum amount you can have in an ISA account, its just I have one with over 10k and not sure if allowed, a little confused?

Eilz

Paul_Herring

eilz wrote:

Is there a MAximum amount you can have in an ISA account, its just I have one with over 10k and not sure if allowed, a little confused?

There is no overall limit. Just the yearly £3000. You are not breaking any rules.

codetown

You can keep adding 3k a year plus the interest gained, with no upper limits.
So if you added 3k per year in the last 5 years you would have today an ISA Mini cash account with roughly 15k plus all interest gained in the meantime (i.e. ~16k pounds).

And all of this would still continue to gain interest tax-free, and each new year you would still be allowed to add another 3k on top of all.
This of course if you keep the money in the ISA account. If you get a part out of the ISA account (e.g. you need them to buy somthing) this part loose the tax-free status and you cannot reinsert it at a later date.

tanith

So its perfectly OK to bung 3k into an existing ISA and open up a new one each tax year...............

grumbler

tanith wrote:

So its perfectly OK to bung 3k into an existing ISA and open up a new one each tax year...............

No
If you bung into existing ISA you cannot open a new one during this tax year.
If you open a new ISA you cannot bung into existing ISA(s) during this tax year.