Totally confused about isa's can you help my firend

hamletcigars

My mate is confused but I know nothing about these so hope someone can help please ..........

she has opened an ISA with her bank and intends to put all her allowance in now before the end ,then more for next years allowance

but she told me she thinks she might already have one still open ,to explain she opened a post office one in order to save a little for her grandchilds future but then forgot about it and only ever put in £10,(with the post office I think) ,if that one is still current will she be breaking the law having the second one ,,,,,,,,,,,,,,,,,,totally confused,both her and myself ,can anyone advice please ,thanks

Mikeyorks

If the £10 was contributed before 6.4.2010 ........ then there is no problem. As that's part of a previous year allowance.

If on or after 6.4.2010 then 2 choices :

1. Transfer the PO one to where she intends to put money in before 6.4.2011 or - more practically
2. Simply close the PO one and take the £10 out. Under self transfer rules that leaves her clear to do as she wishes.

Blackdeal

Mikeyorks wrote: »

If the £10 was contributed before 6.4.2010 ........ then there is no problem. As that's part of a previous year allowance.

If on or after 6.4.2010 then 2 choices :

1. Transfer the PO one to where she intends to put money in before 6.4.2011 or - more practically
2. Simply close the PO one and take the £10 out. Under self transfer rules that leaves her clear to do as she wishes.

Mikeyorks answer is spot on. Whilst it is only a tenner, worth remembering that if you withdraw it under option 2, you lose that £10 from your tax free entitlement for that tax year.