ISA Question - my yearly allowance

Billy_Bob

Hi,

I wonder if you can help as I am fairly new to ISA's?

It has just occured to me that my investment plans may be a bit flawed with regards to yearly ISA allocation.

I currently have a mini cash ISA with Halifax which I have topped up throughout the year to it's maximum 3k. I am planning to continue to top this up in the new tax year. This one does not pose a problem..

My concern lies with the mini Stocks & Shares ISA. I have just opened an Index Tracker with Fidelity which is in an Stocks & Shares ISA. I have invested a lump sum and also set up a direct debit to go into this monthly.

As I understand it I have used ISA my allocation for this tax year.

I am very keen to open a self-select ISA with Squaregain in the new tax year to start building my HYP portfolio.

Am I able to do this given that my direct debit will be sending money into the ISA with Fidelity? Does this count as two new mini stocks and shares ISA for the new tax year? (obviously not allowed)

If I am not able to do this, will I have to give up on the Direct Debit feed to the Index Tracker? I really don't want to do this as I see it as a long term investment.

Can anyone think of a way that I can continue to run my index tracker and have a self-select ISA in the same year and for future years? There is probably an obvious answer but I may be too inexperienced to know it...

Any advice greatly appreciated!!

Bytey

dunstonh

Am I able to do this given that my direct debit will be sending money into the ISA with Fidelity?

No. The minute a payment goes to Fidelity after 6th April, you are have made your choice. You cannot do 2 mini stocks and shares ISAs in the same tax year.

If I am not able to do this, will I have to give up on the Direct Debit feed to the Index Tracker? I really don't want to do this as I see it as a long term investment.

You will have to give up one of your options. Either shares or funds (if you stick with funds, at least try and spread it more. An index tracker as a single fund isnt an ideal option).

Can anyone think of a way that I can continue to run my index tracker and have a self-select ISA in the same year and for future years? There is probably an obvious answer but I may be too inexperienced to know it...

If you want to do both, then do one outside of the ISA.

Deemy

Why not buy an index tracker within the self select isa, well use part of the 4k, though personally I'm no fan of index trackers.

Billy_Bob

Thanks for all of the advice! As I have only just opened the Index Tracker I am reluctant to close this option down as I see it as a +5 year investment. Crumbs!

Perhaps I shall plow cash into my cash ISA this year and build a tidy sum to self-select next year and then possibly scrap or move the Index Tracker.

cheerfulcat

Billy Bob, you should be able to move your index tracker to Squaregain, but you'll have to do the monthly payment manually, AFAICS. As far as the HYP is concerned, if you are going by the "classic" rules you wouldn't be selling anyway, so the ISA is not really required. Even if you run a "tinkering" HYP, the annual CGT allowance should cover you, unless your portfolio is very big.

Having said all that, if it's not too much bother, I would move the tracker and run the HYP alongside within a broker's ISA. If nothing else, it saves on paperwork.

Billy_Bob

CheerfulCat,

That is great advice - thank you so much! I am going to investigate doing my HYP outside an ISA as I am not particularly good at manual payments

Going off to do some research now about what is required of me if I do this..

Thanks again everyone!