Cash ISA open in family members names

bezza1

Hello

This is my first post on here so please excuse me if this question has already been answered elsewhere although i couldn't find it anywhere.

I am planning to put money straight into my ISA at the start of the next tax year and the £5100 allowance will be put in almost straight away as i am using money built up from regular saver accounts that are due to mature. As a result of this i was wondering if it is possible for me to pay into another ISA through out the year in one of my family members names as they are currently do not have an isa and are not planning on using one next year. Is it ok to do this and are there any implications when you want to take the money out or transfer it from their bank to yours? e.g. tax

If anybody knows about this or has any advice then it would be greatly appreciated.

Chris

rb10

They would have to open the ISA themselves, if it is to be in their name.

You can then transfer money into their account - they just need to give you the sort code and account number.

When you want it back, they can simply transfer it back. Like with opening the account, it has to be them to do this, and not you.

This would effectively be a gift from you to them, and they would then give it back to you (again, as a gift) when you require it.

Bear in mind though, that all the time that the money is held in an account in the other person's name, it is legally theirs. If they choose not to give it back to you, then there is nothing at all that you can do about it.

Lokolo

Also you have to be 16 to have a Cash ISA so you can't do it for young children etc.

RayWolfe

Apart from a spouse, it may be considered tax evasion (illegal) if your purpose is to get round tax payments.

Nine_Lives

RayWolfe wrote: »

may be considered tax evasion (illegal) if your purpose is to get round tax payments.

any further info on the above is very welcome.


I have also thought of doing this so am very interested.

Let's pick a scenario & i'll ask....

1. I max out my own ISA in the next tax year with £5,100
2. I then max out (lend the money to) an ISA in (let's say) my mothers name (she would open it, so as far as "legally" goes, it's her money)

Question:

3. once the ISA in my mothers name is maxed out, can the balance be then TRANSFERRED to MY isa that i maxed out in step #1, so that the 2 amounts are then combined in the 1 account making £10,200??

Lokolo

No you can't combine 2 people's ISAs together. ISA = INDIVIDUAL Savings Accounts.