Problems transfering ISA

I had an cash ISA with Abbey and decided to transfer it to Alliance Leicester and set up an account online.

All the paperwork came through and I filled in the transfer document and sent it off to Abbey. In the meantime my april direct debit went into my Abbey account, once my new A&L account was set up I cancelled the direct debit into Abbey and set one up for A&L, my may payment went into A&L.I got a letter from Abbey informing me that they had transfered my money as requested.

I then got a letter from Alliance Leicester saying they 'were unable to accept the funds as Abbey has indicated that this ISA transfer includes current tax year funds. Upon checking our records, you have also subscribed to an ISA with Alliance Leicester this tax year. In accordance with inland revenue regulations, you may only subscribe to one mini cash ISA in the same year. As you are in breach of these regulations please contact the inland revenue'

Please help, all I wanted to do was transfer my money to earn higher interest.

What should I do?

Replies

  • SillychuckieSillychuckie Forumite
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    Tell A&L they are wrong. Call Abbey, confirm that you have not deposited £3000 this tax year prior to the transfer, and get them to send you something in writing to indicate this.
    The transfer slip/account closure confirmation would probably suffice.
    Then send it to A&L. Someone has mucked up somewhere... but if you haven't put in the £3k, you are entitled to.
  • HerewardHereward Forumite
    1.2K Posts
    Without knowing your DD date its difficult to tell who is in the wrong. From what you have written, I assume that your DD date is after 6 April, in which case you have subscribed to the Abbey for this year. I'm not sure if you are able to transfer your ISA if you have made payments in the current Tax Year, but I susspect that you cannot.

    I wait to be corrected.
  • SillychuckieSillychuckie Forumite
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    I am rather certain you can.
    You may transfer between providers whenever you like. You should even be able to pay in 1k with provider A, transfer to provider B and pay in another 1k.
    THEN, transfer to provider C, and pay another 1k.
    You could then transfer to provider D, but could NOT pay another 1k in because you hit your 3k limit.
    That is how I always understood it to be, but I might be wrong.
  • ManAtHomeManAtHome Forumite
    8.5K Posts
    Part of the Furniture Combo Breaker
    My understanding as well, but... if Sir Bill has opened an account with provider B and also funded one with A (DD after April 5th), he will have 2 for this tax year.

    Should be able to close A&L one, then transfer all the Abbey ones over.
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