Opened ISA but no money it it yet!

foreversummer

Hi

I opened a mini cash ISA with Halifax in January this year with the plan of transferring my existing cash ISA.

To cut a long story short, they made such a mess of opening the thing, and gave me so much conflicting information over the phone, that I decided I did not want to entrust them with my funds after all. Therefore I have not submitted the transfer forms and have decided to leave my money where it is. However, the ISA is technically open. I have not contributed to my existing ISA since I opened the new one.

Should I just write to the Halifax and ask for it to be closed. And then can I just start contributing to my existing ISA again the the new financial year.

Any advice greatly appreciated.

mad

Hi

I dont think you have a problem as the thing with cash ISA's is that the limit is about how much you can put in in one year (£3000). If you want to stay with your existing ISA and have not put in 3k over the current tax year then you have till the 5th April to contribute some more.
The fact that you have started negotiations with Halifax and not put any money in. I think is not an issue. I would just fromally tell them that you have closed it. Others may know something that I don't?
After the 5th April you can start a whole new cash ISA up to a max of 3k

Hope that helps

david78

Your "existing ISA" as you put it is one which was presumably funded in tax year 2004-2005 (or earlier). You have not added any more to it your "existing ISA" account year so that is okay.

You now have a new account for 2005-2006 with £0 in it.

You can do one of three things

(1) Do nothing if you don't want to use this years allowance, you can then close the Halifax account with £0 in it (though they may do this for you automatically.)

(2) If you want to use this years allowance, you will need to put money in the Halifax account (you might want to put a modest sum of £100 or less in there).

** you can still close the account with option 2 if you need your money back quickly **

If you do (2), then you can put some more money in the Halifax ISA account next year as well if you want or you can open a new account with someone else. If you do (1) and want an ISA next year you will have to open a new account.

If I were you I would do option (2) even if you can only put a few pounds in.

If you want to put money in your "existing ISA" for next year you will have to make a new application to open an account on or after 6 April 2006, as you will have not put any money in this year. They will probably add your new money to the old account though.

isasmurf

foreversummer wrote:

However, the ISA is technically open.

Under ISA regulations, it is not "technically" open until you put some money in it.

foreversummer

david78 wrote:

Your "existing ISA" as you put it is one which was presumably funded in tax year 2004-2005 (or earlier). You have not added any more to it your "existing ISA" account year so that is okay..[/b]

I have funded my "existing ISA" in the year 2005-2006. I decided to arrange a transfer in January 2006 but after opening the ISA with the Halifax, I decided not to go ahead with the transfer. But I have a document which says that an ISA has been opened.

Although I haven't used my full allowance for this year, I am quite happy not to (as I haven't the funds available anyway).

I think I will write to the Halifax to close the new ISA. They presumably after 1st April I can just pay some money into my existing ISA - I have an online facility with IF. Then I will only have contributed to one ISA in any one year.

Does this make sense? Sorry I am getting confused.

bradley_2-2

i dont get how you say it was difficult to open?

1) apply
2) get form in post
3) send form back
4) put cash in

you're the one holding it up, stalling between step 2 and 3.

foreversummer

No Bradley

Spoke to someone on the phone saying that I wished to transfer my existing ISA. Told to download form from website sending a deposit to open it. Told that transfer forms would arrive in post.

They managed to open the ISA Saver, not the ISA Saver Direct. No transfer forms arrived. I chased them up and was told that I should not have sent an opening deposit if all I wanted to do was to transfer an existing ISA.

Went into a branch to try to sort the mess out, no one was able to help. Branch staff were not sure if I was supposed to open it with a deposit or not. Found out via the good people on this website that I should not have opened it with a deposit. Visited the branch again to withdraw my cash.

Transfer forms arrived three weeks later. Fed up with them by this point.

So no, I am not holding it up - have decided to vote with my feet and not trust them to handle my ISA.

Cee

I take it you opened the account over the phone? All telephone accounts are closed after 30 days if not funded. Saying that, you should have been informed of that.

Transfer ins are not classed as a tax year fund as they are previous tax year funds and its just a way for savers to keep all their isa's together in one basket as it were.

You could have funded the account with your 3k entitlement and have all the funds in one account.

I am certainly not surprised you and everyone involved was confused. I joined them in January and to be perfectly honest you need to study isa's as an o level before you can appreciate how they work. Unfortunatly the training with the Halifax is way to intense and you are literally thrown in at the deep end, 3 weeks can go by before you only begin to grasp the fundamentals.

Even now we find that some agents are processing accounts differently from ourselves and the branch staff are like a new department altogether.

E.G Putting someone who speaks really bad english on the telephone to open an account!!