ISA advice 31 March 2009 at 8:03PM edited 30 November -1 at 1:00AM in ISAs & Tax-free Savings 5 replies 636 views

runner1_2

Hi,

I opened an Egg Isa back in September of last year but since the interest rate had dropped significantly and the new tax year is just round the corner, I'm quite confused what I should do.

I'm not very bright and not really money savvy but starting to learn so forgive me for the dumb questions

I never used up my allowance (I have £900 left) and I was wondering would the sensible option would be to just open another Isa and transfer the money I have from Egg? Or just leave it and open a new Isa?

I was looking at the Natwest e-Isa, should I open this asap and transfer the money or wait till 6th and after?

Thanks.

barny_100

Definitely transfer to the higher rate ISA. Why miss out when you only have to fill in a form?

As you opened and subscribed to (added money) to the Egg ISA in this tax year you need to wait till the new one 6th April to open the new one. Then transfer ASAP and enjoy the better rate.
I'm doing exactly the same with the Natwest ISA! :beer:

Baldur

barny_100 wrote: »

As you opened and subscribed to (added money) to the Egg ISA in this tax year you need to wait till the new one 6th April to open the new one. Then transfer ASAP and enjoy the better rate.

You can transfer a Cash ISA at any time, you don't need to wait until 6th April - 'opening' an account for the purposes of transferring an existing Cash ISA does not constitute opening a new Cash ISA. Just choose a new provider that accepts transfers and complete their transfer form, they must arrange the transfer.

You can then add your 2009/10 allowance of £3,600 on or after 6th April.

barny_100

Baldur wrote: »

You can transfer a Cash ISA at any time, you don't need to wait until 6th April - 'opening' an account for the purposes of transferring an existing Cash ISA does not constitute opening a new Cash ISA. Just choose a new provider that accepts transfers and complete their transfer form, they must arrange the transfer.

You can then add your 2009/10 allowance of £3,600 on or after 6th April.

I know you can transfer whenever but as I read it Natwest require £1+ to open the ISA. So if they have already paid into their current ISA in 09/09 tax year that would count as subscribing to 2 ISA's in 1 tax year. Surely that would be a technical breach of the rules?

Baldur

barny_100 wrote: »

I know you can transfer whenever but as I read it Natwest require £1+ to open the ISA. So if they have already paid into their current ISA in 09/09 tax year that would count as subscribing to 2 ISA's in 1 tax year. Surely that would be a technical breach of the rules?

If you read other posts on the Natwest e-ISA, people have just entered £1 into the web form and progressed with the application without actually paying any new money in at all - it appears to be a similar situation as the Halifax Direct ISA Reward, where the website & intranet software expects to see something in that box.

As long as no deposit is made, despite what is entered in the box, there's no breach of the ISA rules, either technical or actual.

facetheglue

I also have an ISA with Egg I opened in 07/08, it was a great 6% rate back then but after thinking about it for a few days I've just posted a transfer form off to M&S today. Not the best rate but it seems like there won't be any problems if I ever want to take money out.

I was actually going to stay with Egg despite the poor interest rate but I e-mailed them over a very very small issue on my statement (when I used a debit card to pay money in the calculated balance would show as £0.00, but when my next direct debit came in it updated with both figures) but the reply I got didn't even address the issue. I thought it was pretty rubbish customer service and made me annoyed, even though I wasn't that bothered in the first place! Ever since then I can't even see my account history online! Rubbish.