My money is in the wrong place - where should it be?

rb10

Cheetah2005 wrote: »

You can't replace it in that tax year right?

What I mean is:

Say I put 3.6K in an ISA and then removed 1K of it. I can't put any more money in that ISA in the same financial year. But come next financial year I can add 3.6K to the current 2.6K that is in the isa (if I want)....

....correct?

Yes, correct.

On 6th April every year, everyone's allowance available to them is reset to £3600, regardless of what they've done in previous tax years. So as long as the amount you pay in during any single financial year is no more than £3600, you'll be fine.

Cheetah2005

So under what circumstances should somebody NOT use an ISA then?

Also what's the stuff about transferring ISAs. I take it there is only a problem if you want to transfer during a financial year or if you have an ISA of over 3.6K because you can only put 3.6K in a year...how do people get around this?

Also - how is the amount you have deposited/withdrawn in a year monitored?

Because surely if I have a natwest current account and ISA if in NEED to get some of the ISA cash at short notice I can because the transfer would be instant.

Looks like I'm going to apply for a Natwest e-ISA then.

jem16

Cheetah2005 wrote: »

So under what circumstances should somebody NOT use an ISA then?

If you are a non-taxpayer and never likely to be then you may not need one.

Also what's the stuff about transferring ISAs. I take it there is only a problem if you want to transfer during a financial year or if you have an ISA of over 3.6K because you can only put 3.6K in a year...how do people get around this?

Transfers don't count towards your allowance. You can transfer an ISA with £30k in it plus still deposit new funds of £3600.

Also - how is the amount you have deposited/withdrawn in a year monitored?

It's monitored by your ISA provider. However all info will eventually get to HMRC too.

Because surely if I have a natwest current account and ISA if in NEED to get some of the ISA cash at short notice I can because the transfer would be instant.

As long as the ISA is instant access then yes.

rb10

Cheetah2005 wrote: »

So under what circumstances should somebody NOT use an ISA then?

If they are not a tax payer, and do not expect to pay tax whilst they have this money in savings. If you are not paying tax at the moment, then consider all accounts - not just ISAs. Look at https://www.moneysupermarket.com/savings, https://www.moneysavingexpert.com/savings

Cheetah2005 wrote: »

Also what's the stuff about transferring ISAs. I take it there is only a problem if you want to transfer during a financial year or if you have an ISA of over 3.6K because you can only put 3.6K in a year...how do people get around this?

Transfers do not count at all towards the £3600 limit. The limit only applies to new money coming into an ISA.

Cheetah2005 wrote: »

Also - how is the amount you have deposited/withdrawn in a year monitored?

Your bank will check that you don't pay more money than you should. They report details of the accounts you hold, and whether new money has been paid into them during the previous tax year, to HMRC. This is why you have to give your NI number when you open an ISA - so that HMRC can identify you.

Cheetah2005 wrote: »

Because surely if I have a natwest current account and ISA if in NEED to get some of the ISA cash at short notice I can because the transfer would be instant.

Yes, that's correct.