Nsi

mindovermatter

Hi,
I have £6000 to invest for myself and my wife in National Savings Direct ISA paying 5.3% AER.
My question is what happens at the end of the financial year - can I add another £3000 each into the fund and then I have £6000 paying that rate??
or do I get told to withdraw the money?
can seem to find my answer on their website.
best wishes
mindovermatter

ReportInvestor

You can add another £3K each from April 6th 2007.

Your interest and original capital can remain invested and earn further tax free interest .

Obviously check the rate at the end of March 2007.

If you like it, stick with NSI. If there's a better one transfer available elsewhere, then transfer out of the NSI ISA (no fees) and add your next £3K to your new account with the new provider.

NSI doesn't allow transfers in (at least not to its top paying ISA), but does allow free transfers out.

jamescredmond

ReportInvestor wrote:

You can add another £3K each from April 6th 2007.

Your interest and original capital can remain invested and earn further tax free interest .

Obviously check the rate at the end of March 2007.

If you like it, stick with NSI. If there's a better one transfer the NSI ISA elsewhere (no fees) and then add your other £3K to your new account with the new provider.

NSI doen't allow transfers in (at least not to its top paying ISA), but does allow free transfers out.

this is something - in my financial ignorance - I was unaware of. thanx.
presumably, it's possible to keep 'topping up' the ISA every finan. year and still benefit from the tax benefits. reportinvestor - is this correct?

ReportInvestor

Absolutely.

It's costing the Treasury a fortune. So take advantage to the max until they decide to reduce the £3K annual limit.

Next review is in 2010.

Gordon was going to reduce it to £1K pa but caved in for political / electoral reasons. 2010 is likely to be after the next election, so he many have more of a free hand then .

All being well, once you've got the money invested you have got the tax benefit for life (if you keep it invested) even if they change the rules for future tax free investment.

Cypher

sorry to jump in on your thread mindovermatter, I just thought of something whilst reading ReportInvestors reply.

I hadn't thought of this before and as I've only just opened an ISA, April will be the first time I am in the position to open a second ISA.

I know you can only have one ISA in any Tax year but when opening a second ISA do you have to transfer the old ISA to the new one or can you have more than one ISA?

I can see the advantage of transfering the old ISA to a newer one with a better rate, but I may want to have several ISA held at different banks / building societies rather than having all my eggs in one basket.

ReportInvestor

You can have more than one ISA as long as you follow the rules e.g. NSI mini-cash ISA in 2006/7, Kent Reliance BS mini-cash ISA in 2007/8.

Cypher

Thanks :beer:

ReportInvestor

Some carpetbaggers deliberately open a different ISA each year at a new building society.

Bizarrely the same rules that say you may only open one new ISA in each current tax year then allow you to split that past ISA between [several] different providers in subsequent tax years. Weird. .

And terribly messy. Only one for the true anoraks.

Cypher

Some carpetbaggers deliberately open a different ISA each year at a new building society.

That is one of the things I was looking at for April

ReportInvestor

:exclamati :eek: :where is the tick off smilie on MSE when you need it: :cool:

Seriously, good luck. Just make sure that you find some decent rates & don't end up with two birds in the bush rather than one in the hand.

mindovermatter

many thanks for the advice - thats what we will do then - both start an ISA now with £3000 each and then put in another £3000 in April 2007.
kind regards
mindovermatter