ISA Advice

impdriver

Hi, hope someone can help...

I have an ISA with one provider which for this tax year (2010/11) I have now put in £5000 (cash). I recently opened a second stocks and shares ISA with another provider with a view to further and future investments, but to open this I had to deposit £100 (cash), which takes me to the ISA limit of £5100.

What is the scenario if I have another £100 pound to invest in the first ISA (the one with £5000 in it)? Does the £100 in the stocks and shares ISA count as part of the £10,200 limit (for both types of ISA) or does this come off my yearly cash allowance. What happens if I add the £100 to the £5000 am I over my limit? am I taxed on the extra £100 pound or is the ISA no longer an ISA and becomes a normal savings account?

Any help much appreciated, sorry if this question has been here before, couldn't find it if it has.

Cheers
Phil

scottishblondie

You are not at the ISA limit - the point at which S&S ISA impact on your cash ISA allowance is if you invest more than £5100 in S&S, in which case your cash ISA allowance is reduced accordingly. You can still add £100 to the cash ISA, and invest another £5000 in S&S if you want.

KingL

What do you mean by "I had to deposit £100 (cash)" [into the S&S ISA]?. Exactly what did they ask you to do? In every S&S ISA you have to put cash into it in order to fund the purchasing of the stocks and shares - this is (a) different (allowance) from cash put into a cash ISA.

Is the £100 just funding for upcoming shares purchase inside the wrapper, or is it something different ?

impdriver

Thanks for your help so far...

The £100 cash paid in to the S&S ISA was the min to open the account, and it will be used to fund any future share purchase, so from what you guys say this doesn't count towards my £5100, cash allowance?

Therefore think I am happy that I can still use the last £100 in my cash ISA allowance for this year...

Many thanks
Phil :j